Wheat Prices Soar Amid Black Sea Export Disruptions
The European wheat market closed the week on a high note due to concerns over reduced exports from Russia and Ukraine. Euronext wheat rose by 1.3% to €235.75 (USD273.07) a metric ton, setting a new two-week high at €237.50. The December wheat contract was up 1.6% for the week.
The front-month September futures led gains with technical adjustments adding support from Black Sea tensions. Ole Hansen, head of commodity strategy at Saxo Bank, noted that 'wheat has regained a geopolitical premium.'
Ukrainian attacks on Russian grain facilities and Russian strikes against Ukrainian ports have highlighted the vulnerability of one of the world's most important agricultural export corridors.
Russia's rejection of a possible Black Sea truce rekindled market worries. Shipowners may be reluctant to send vessels into the war risk zone, potentially disrupting shipments from Russia's main grain export hub of Novorossiysk.