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Wheat eases as Ukrainian supply, recession fears weigh

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U.S. wheat futures eased in Asian trading on Monday, pressured by Ukrainian supplies under a deal brokered by the United Nations and Turkey, and concerns that a global recession would dampen demand.

Soybean prices were slightly firmer after four straight sessions of losses, while corn was nearly flat.

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The most-traded wheat contract on the Chicago Board of Trade (CBOT) was down 1.1% at $8.50-3/4 a bushel, as of 0615 GMT.

A total of 165 ships with 3.7 million tonnes of agricultural products on board have left Ukraine under a deal to unblock Ukrainian sea ports, the Ukrainian infrastructure ministry said on Sunday.

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On Saturday, the third vessel charted by the United Nations World Food Program left Ukraine’s Chornomorsk Black Sea port with around 30,000 tonnes of wheat on board, bound for Ethiopia.

CBOT soybeans rose 0.4% to $14.54 a bushel, while CBOT corn was little changed at $6.77 a bushel.

Uncertainty over demand as aggressive monetary policy tightening by central banks around the globe could tip the global economy into recession kept investors cautious.

All eyes are on the U.S. Federal Reserve, which is expected to deliver a super-sized hike of 75 basis points this week to fight sticky inflation.

“A more aggressive Federal Reserve rate hike profile and tighter monetary conditions will only intensify the threat,” ING economists said in a note.

U.S. soybean futures may remain volatile amid stiff export competition from South America, particularly from Argentina, and fears of a global recession, analysts said.

Farmers in Argentina, the world’s top exporter of soybean oil, have increased sales of soybeans after the government implemented a more favorable exchange rate for exports of the cash crop.

Commodity funds were net sellers of CBOT corn, soybean and soymeal futures contracts on Friday, and net buyers of wheat and soyoil futures.

(Reporting by Enrico Dela Cruz in Manila; Editing by Subhranshu Sahu)

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