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Wheat rebounds as Russian attacks cast doubts over Ukrainian supplies

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SINGAPORE — Chicago wheat futures rose more than 2% on Monday, recouping some of the previous session’s sharp losses, as Russia’s missile attacks raised concerns over Ukrainian supplies, despite a deal between the two nations.

Corn rose 1.2%, while soybeans added 0.2%.

“The Black Sea corridor itself is news but it does not guarantee that shortfall will reach the market,” said Tobin Gorey, director of agricultural strategy at the Commonwealth Bank of Australia.

“Russia launched missile attacks on the port of Odesa over the weekend. The attacks make a mockery of the corridor agreement – but then by now that kind of action is hardly a surprise.”

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The most-active wheat contract on the Chicago Board of Trade (CBOT) climbed 2.5% to $7.78 a bushel, as of 0215 GMT.

Corn gained 1.2% at $5.70-3/4 a bushel and soybeans rose 0.2% to $13.18-1/4 a bushel.

Ukraine pressed ahead on Sunday with efforts to restart grain exports from its Black Sea ports under a deal aimed at easing global food shortages but warned deliveries would suffer if a Russian missile strike on Odesa was a sign of more to come.

President Volodymyr Zelenskiy denounced Saturday’s attack as “barbarism” that showed Moscow could not be trusted to implement the deal struck just one day earlier with Turkish and United Nations mediation.

However, Russia’s foreign minister, Sergei Lavrov, offered reassurances over Russian grain supplies to Egypt during a visit to Cairo on Sunday, amid uncertainty over a deal to resume Ukrainian exports from the Black Sea.

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Egypt is one of the world’s top wheat importers and last year bought about 80% of those imports from Russia and Ukraine. Russia’s Feb. 24 invasion of Ukraine disrupted shipments and sped up a rise in global commodity prices, delivering a financial shock to Egypt.

European traders said on Friday buyers from China purchased large volumes of Australian and French wheat this week in a sign that the Asian country is taking advantage of a recent dip in prices to fill its large needs.

Soybean exports from Brazil are expected to total 91.5 million tonnes in 2023, up from the 77.2 million estimated for 2022, as the world’s biggest supplier prepares to plant a super crop.

The projection, made by private consultancy Safras & Mercado on Friday, reflects bullish yield and acreage forecasts for the next season, which comes after one in which a drought spoiled part of the crop.

Large speculators cut their net long position in CBOT corn futures in the week to July 19, regulatory data released on Friday showed.

The Commodity Futures Trading Commission’s weekly commitments of traders report also showed that noncommercial traders, a category that includes hedge funds, trimmed their net short position in CBOT wheat and cut their net long position in soybeans. (Reporting by Naveen Thukral; Editing by Subhranshu Sahu)

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