Black Sea grain corridor, weather, and harvest pressure wheat prices

Russia’s unprovoked invasions of Ukraine sent already bullish wheat futures prices soaring earlier this year.  However, the first grain vessel to leave Ukraine since Russia’s February invasion set sail on Monday, August 1.

The ship, carrying 27,000 metric tons (MT) of corn bound for Lebanon, was able to sail nine days after Ukraine and Russia agreed to a deal brokered by the United Nations (U.N.) and Turkey. The news of the Ukrainian grain cargo’s safe arrival in Turkey sent Chicago Board of Trade wheat futures down more than 3% on August 2. Harvest across the northern hemisphere is another factor helping global wheat prices soften. However, the weather will play a crucial role in the weeks ahead. Hot weather could slash yields as it did in India this year. Too much rain could create quality issues.