U.S. wheat slumps 6 percent after Russia says it will resume Black Sea grain deal

Wheat futures plummeted from Chicago to Europe on Wednesday after Russia said it would resume its participation in a deal to export grain from war-torn Ukraine after suspending it over the weekend in a move that had threatened global food supplies.

The Chicago Board of Trade (CBOT) most-active wheat contract fell 6 percent to US$8.47-3/4 a bushel by 1100 GMT, paring the two-day rise that followed the announcement of Russia’s suspension.

Corn followed the trend, down 2.3 percent to US$6.81-3/4 a bushel while soybeans were down 1 percent at US$14.33-1/2 a bushel.

“These latest announcements remove part of the risk premium for exporters so we are losing what we had gained over the past days in wheat,” Arthur Portier of consultancy Agritel said.

“However, we still don’t know whether the deal will be extended later this month so uncertainty remains,” he added.

Wheat also tumbled in Europe where the benchmark December contract was down 4 percent at 343.50 euros a tonne, also recouping its losses from earlier this week.

Russia said it would renew its participation in the U.N-brokered grain corridor just four days after suspending its role in the deal saying it could not guarantee the safety of civilian ships crossing the Black Sea because of a drone attack on its fleet there.

The U-turn followed a phone call between Russian President Vladimir Putin and Turkish President Tayyip Erdogan on Tuesday, and repeated conversations between their defence ministers.

European rapeseed also slumped as the bloc imports large amounts of the oilseed from Ukraine. A resumption in exports is bringing relief to biodiesel and feed makers.

Tags: wheat, CBOT, futures, deal, contract, Ukraine, Russia, export, grain