Wheat Drops amid Russian Export Issues and Wartime Shipping

On Friday, Euronext wheat dropped to a one-month low brought by export competition from Russia and wartime shipping routes from Ukraine.

Wheat futures for May delivery declined by -0.22% to $720.30 per bushel on February 27’s Asian afternoon session.

The most active contract on the Paris-based Euronext, the May wheat, fell by 1.30% to $295.60 per ton. Over the week, it had reached nearly a 4.00% decrease.

According to analysts, there is still relief in the market. Russia has not started a new primary offense that intensifies Ukraine attacks. They haven’t made actions that mark the first anniversary of the war.

This week, Egypt purchased 240,000.00 tons of grains from the Soviet Union. Traders are observing if the supplies are priced competitively again the following week.

Also, they added that there is still a lot of Russian wheat available. On February 24, its output included 30,000.00 tons for exports costing around $305.00 per ton free on board.

Furthermore, experts said that Moscow’s deliveries are anticipated to decline to 40.00 million metric tons in the marketing year 2023 to 2024.

Moreover, Kyiv’s shipments have plunged by over a third in the MY 2022 to 2023 from July to June. Moreover, Russia and Ukraine are the world’s top grain suppliers, responsible for 27.00% of wheat.

US Export Concerns Led Wheat to a Multi-week Low

Chicago Board of Trade wheat reached its lowest point in over four weeks amid competitive global export business issues.

Additionally, traders expect an extension of the Black Sea grain deal that bridges Ukrainian crops to world buyers. The speculations are due to the first anniversary of Russia’s invasion of Ukraine.

Last year, the agreement intensified competition for suppliers of wheat. According to an analyst, the availability of cheap grains from the Black Sea region will create tough competition. Likewise, it will hit other outputs, such as corn.

Also, CBOT wheat settled at $0.28-3/4 at $7.21-3/4 per bushel, hitting its weakest price since January 23. Besides, it hit a one-month low with the US market facing additional issues from a strong dollar.