Wheat and corn market fall as Ukraine-Russia talks boost ceasefire hopes
U.S. wheat futures fell 4% and corn fell nearly 3% on Tuesday as comments by Russia and Ukraine following negotiations in Turkey raised hopes of a ceasefire in a conflict that has disrupted massive grain exports through the Black Sea region.
U.S. wheat futures fell 4% and corn fell nearly 3% on Tuesday as comments by Russia and Ukraine following negotiations in Turkey raised hopes of a ceasefire in a conflict that has disrupted massive grain exports through the Black Sea region.
However, trade was volatile, with benchmark May wheat futures on the Chicago Board of Trade (CBOT) swinging in a huge 96-cent range, from a session high of $10.68-1/4 in early moves to a low of $9.72 per bushel. Both CBOT wheat and corn futures briefly fell their respective daily limits before paring losses.
CBOT May wheat settled down 42-3/4 cents at $10.14-1/4. May corn ended down 22-1/4 cents at $7.26-1/4 a bushel and May soybeans fell 21-1/4 cents to finish at $16.43 a bushel.
The wheat market has been particularly turbulent since Russia invaded Ukraine on Feb. 24. Both countries are major wheat exporters, while Ukraine is also a significant global corn supplier. Russia promised to scale down military operations around Ukraine’s capital and north, while Kyiv proposed adopting neutral status, in confidence-building steps that were the first signs of progress towards negotiating peace.
Grain futures fell along with crude oil in a “knee-jerk reaction” to those headlines, said Jack Scoville, market analyst at the Price Futures Group in Chicago.
But the wheat and corn trimmed losses as some investors saw a buying opportunity, given that global grain supplies were tightening even before Russia’s invasion began.
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“We were sharply higher because of this war, and now maybe the war is going away, so we are retracing a little bit. But ... it does not change the fact that it is still an overall tight situation out there,” Scoville said.
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