Wheat dwindles as Black Sea grain corridor opens

On August 12, wheat prices stepped lower amid the resumption of the Black Sea grain corridor. Chicago futures tied to the commodity plummeted 1.07% or 8.75 points to $801.25 per metric ton.

Accordingly, a cargo ship loaded with Ukrainian wheat left the port of Odessa, heading for the Lebanese facility of Tripoli.

In line with this, the reopening of the channel will to some extent ease global food supply tensions. The Black Sea port could now allow the flow of more than 20.00 million metric tons of grain to the international market.

The United Nations and Turkey arranged an agreement in July to resume the shipment of the essential commodities. Previously, the shipment lanes closed for more than five months since the Russia-Ukraine war broke out. The conflicted countries account for more than 30.00% of global grain exports.

Correspondingly, analysts expected more cargo vehicles carrying wheat to follow in the coming days. They expected the initial ships to arrive today to load 23,000 metric tons of the staple for Ethiopia.

Nevertheless, lingering factors continue to affect the stability of the global food industry and supply chains. Thus, any emergency could again trigger massive reductions in commodity stocks, benefitting wheat prices.

Wheat and other grains down

Like wheat, corn futures skidded 0.12% or 0.88 points to $628.12 per metric ton. Similarly, soybean contracts slumped 0.41% or 5.88 points to $1,442.12 per metric ton.

Nevertheless, the grain market remained firmed, bolstered by concerns about hot and dry weather stressing the US Midwest crops.

Subsequently, heat in the western regions of the farm belt could continue stressing the grains. This dry and hot weather triggers investor uncertainty about yield risks.

Wheat traders now look ahead to the monthly report of the US Department of Agriculture later this day. Additionally, they will focus on the World Agricultural Supply and Demand Estimates report.