Chicago | Reuters—U.S. wheat futures rose for a third-straight session on Tuesday, posting a one-week high on fears of escalating war in the Black Sea breadbasket region amid rising tensions between Moscow and Washington over Ukraine, analysts said.
But soybean futures fell 1.1 per cent, with the benchmark contract dipping back below $10 a bushel, as favorable Brazilian weather bolstered expectations for a bumper crop in the world’s No. 1 soy producer. Corn futures ended lower too as declines in soybeans overshadowed the strength in wheat.
Chicago Board of Trade March wheat WH25 settled up 2 cents at $5.67-3/4 per bushel, paring gains after reaching $5.75-3/4, the contract’s highest since Nov. 12.
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CBOT January soybeans SF25 ended down 11-1/4 cents at $9.98-1/2 a bushel and December corn CZ24 finished down 2 cents at $4.27-1/4 a bushel.
Wheat rose after Ukraine used U.S. long-range missiles to strike Russian territory, taking advantage of newly granted permission from the outgoing Biden administration on the Ukraine war’s 1,000th day.
“Wheat prices added a bit more war premium again this morning on the chance that we could see this escalation result in tit-for-tat attacks on export infrastructure and/or the ships themselves,” StoneX Chief Commodities Economist Arlan Suderman wrote in a client note.
“Fear levels are still relatively low, but it is a possibility that’s on the minds of traders,” Suderman said.
Meanwhile, Ukraine’s wheat harvest may increase next year thanks to a larger sowing area, first deputy agriculture minister Taras Vysotskiy told Reuters in the ministry’s first official forecast for next year’s harvest.
Soybean futures fell on expectations of hefty supplies from South America, specifically Brazil, where planting of the 2024/25 soybean crop is about 80 per cent complete. Oilseed lobby Abiove projected Brazil’s harvest at 167.7 million tons, a volume that should lift soy exports and domestic processing to record highs.
The U.S. Department of Agriculture has forecast Brazil’s crop at 169 million tons.
The South American country will announce farm agreements with China, its biggest trade partner, on Wednesday ahead of scheduled meetings with Chinese President Xi Jinping, Brazil’s agriculture minister said.
—Additional reporting by Mei Mei Chu in Beijing and Sybille de La Hamaide in Paris
