Corn and wheat at four-month highs

Wheat and corn futures on the Chicago Stock Exchange rose to their highest level since June on Monday, amid growing concern that an escalation in fighting between Russia and Ukraine could further disrupt grain shipments from the United States. Black Sea ports.

The rally in wheat gave a boost to corn futures, which also rose on expectations of lower crop forecasts in the United States and Europe.

Soybean futures, meanwhile, gained as traders tried to adjust their positions ahead of the USDA’s monthly data on global farm supply, demand and crop production on Wednesday.

The most active wheat futures on the Chicago Stock Exchange gained 7.21% to $9.4375 a bushel. Corn rose 2.27% to $6.9875 a bushel, while soybeans advanced 0.62% to $13.7550 a bushel.

In the last four months, grain prices have risen 15.52% for corn and 16.03% for wheat. Likewise, since the beginning of the war in Eastern Europe they earn 6.68% in the case of wheat, and 1.94% in corn.

So far this year, corn has gained 17.64% and wheat 20.84 percent.

Russia attacked Ukrainian cities on Monday in apparent revenge after President Vladimir Putin declared an explosion on the Crimean bridge a terror attack.

“For grains, this is a Putin rally,” said Don Roose, president of US Commodities. “The fear has really intensified in the markets that he’s just not going to accept a grain export deal from now on given the military action.”

“Markets are concerned about the possibility of the USDA increasing the soybean yield or acreage in the report, as it has in previous years,” Roose said.

Uncertainty over demand from China, the world’s biggest buyer of soybeans, also kept earnings in check, traders said.

Confidence

The four-month grain export deal from Ukraine agreed with Moscow and kyiv, which expires on November 19, should be extended for a year, a senior UN official said on Monday.

Martin Griffiths, head of humanitarian affairs at the UN, said he is “reasonably” confident that the initiative’s term will be renewed.

“We would like it to be renewed and even extended to include more fertilizers,” he said, questioned about the negotiations.

Two agreements were signed under the aegis of the UN on July 22: one to allow the export of Ukrainian grains blocked by the war launched by Russia against the country and another for Russian food and fertilizer exports, despite Western sanctions against Moscow.

Griffiths indicated that the agreement was valid until November 22, but the UN spokesperson in charge of this issue, Ismini Palla, later specified that “it is initially planned for a duration of 120 days, which would take it until November 19. november”.

“The agreement will be automatically extended for the same period unless one of the parties notifies the other of its intention to terminate or modify it,” he said.

Griffiths considers that “it should be extended beyond the four-month cycle. We need a one-year renewal,” insisted the person in charge from Geneva.

“Farmers need to know soon if it’s worth planting for next year’s crop,” he explained.

UN Secretary-General Antonio Guterres and his team are actively working to prolong the agreement that has allowed world food prices to fall, his spokesman said on Friday.

high volatility

Alfonso García Araneda, director of Gamma derivatives, commented that the global grain market faces strong volatility, due to factors that do not clarify the outlook.

The derivatives specialist said that corn inventories fell in the United States, which caused an increase in the price of grain.

The increase in the price of oil, after the OPEC+ agreement to lower oil production, affects the cost of energy, essential for the field.

García Araneda recalled that this Wednesday there will be the report of the United States Department of Agriculture for October, which could give clarity to the markets.

For his part, Antonio Ochoa, grain specialist at the RJO’Brien brokerage, commented that the production of corn, wheat and soybeans in the United States tends to be lower.

Given this scenario, he explained, we have to turn to the south, since the agricultural cycle in Europe and Asia has been limited.

“Several countries in Latin America will face great challenges, with this the United States will be the only supplier with great capacity for the next 5 months, while the South American harvest arrives,” he said. (With information from agencies)

termometro.economico@elecononista.mx