Supply Chain

Wheat Up On Renewed Threats To Black Sea Supplies; Soybeans Firm

By Reuters
Share this article
Wheat Up On Renewed Threats To Black Sea Supplies; Soybeans Firm

Chicago wheat bounced back on Monday as a Russian warship's firing of warning shots at a cargo ship in the Black Sea region heightened concerns over world supplies.

Soybeans also rose, recouping some of the last session's losses, while corn eased.

"There is growing risk to Black Sea supplies, which has not been fully factored into the market," said one Singapore-based trader. "Prices are likely to rise further if there is disruption to Russian supplies."

The most-active wheat contract on the Chicago Board of Trade added 0.2% to $6.28 a bushel, as of 0348 GMT, and corn lost 0.2% to $4.86-1/4 a bushel. Soybeans rose 0.4% to $13.12-1/4 a bushel.

Merchant Shipping

A Russian warship on Sunday fired warning shots at a cargo ship in the southwestern Black Sea as it made its way northwards, the first time Russia has fired on merchant shipping beyond Ukraine since exiting a landmark UN-brokered grain deal last month.


Firing on a merchant vessel will ratchet up already acute concerns among shipowners, insurers and commodity traders about the potential dangers of getting ensnared in the Black Sea - the main route that both Ukraine and Russia use to get their agricultural produce to market.

Earlier, Ukraine, which is seeking to form safe shipping routes in the Black Sea, had started registering ships willing to use the corridor it announced earlier last week, a local news agency said on Saturday.

Lower US Output

The agricultural markets are likely to be supported by expectations of lower output in the United States.

U.S. corn and soybean harvests will be smaller than previously expected as dry conditions early in the growing season robbed the crops of yield potential, the government said on Friday.


Both forecasts fell below market expectations, but the corn crop, if realised, would still be the second biggest on record due to large acreage and as growing conditions improved during the key development month of July.

The government forecast corn production of 15.111 billion bushels, based on an average yield of 175.1 bushels per acre, according to the U.S. Agriculture Department's monthly World Agricultural Supply and Demand Estimates report. Soybean production was seen at 4.205 billion bushels, with yields pegged at 50.9 bushels per acre.

Large speculators increased their net short position in CBOT corn futures in the week to Aug. 8, regulatory data released on Friday showed.

The Commodity Futures Trading Commission's weekly commitments of traders report also showed that noncommercial traders, a category that includes hedge funds, increased their net short position in CBOT wheat and cut their net long position in soybeans.

Get the week's top grocery retail news

The most important stories from European grocery retail direct to your inbox every Thursday

Processing your request...

Thanks! please check your email to confirm your subscription.

By signing up you are agreeing to our terms & conditions and privacy policy. You can unsubscribe at any time.