CHICAGO: Wheat futures fell to below $8.1 per bushel in November, the lowest in two months, and returned to levels prior to Russia’s invasion of Ukraine as expectations of strong supply eased shortage concerns.
Data from the USDA’s WASDE report increased projections for world supply and ending stocks for the upcoming marketing year of wheat, compared to expectations of a decline, as higher output in Australia and Kazakhstan offset potential declines in Argentina and the EU.
Supplies were also supported by Russia agreeing to resume the UN-brokered agreement that guarantees a safe corridor for vessels carrying Ukrainian grain after demands have been met by Ukrainian officials.
The move came after Moscow suddenly decided to suspend the agreement at the end of October, citing security concerns that were denied by Kyiv.
Now, investors await the meeting between the UN and the Russian delegation to discuss the extension of the deal, as the current agreement ends on November 19th.
As Russia said it would resume its participation in a deal freeing up grain export deal from war-torn Ukraine, reversing a move that world leaders had said threatened to exacerbate global hunger.
Moscow announced the sudden reversal after Turkey and the United Nations helped keep Ukrainian grain flowing for several days without Russian participation in inspections.
The Russian defence ministry justified the u-turn by saying it had received guarantees from Kyiv not to use the Black Sea grain corridor for military operations against Russia. Kyiv did not immediately comment on that, but has denied in the past that it used the agreed shipping corridor as cover for attacks.