US wheat drops as Russia considers Ukrainian grain exports

Corn pressured by falling wheat, soybean futures climb
calendar icon 1 June 2022
clock icon 2 minute read

Chicago wheat futures fell on Tuesday, after Russian President Vladimir Putin expressed readiness to allow blocked Ukrainian grain vessels from Black Sea ports, reported Reuters.

Corn was pressured by falling wheat, while profit-taking pulled soybeans off life-of-contract highs to finish lower.

The most-active wheat contract on the Chicago Board of Trade (CBOT) fell 70 cents to $10.87-1/2 a bushel, its biggest daily decline since 16 March.

Corn slipped 23-3/4 cents at $7.53-1/2 a bushel, while soybeans lost 49 cents lower at $16.83-1/4 a bushel, after reaching a contract-high $17.49-1/4.

Putin said on Monday that Russia was willing to facilitate Ukrainian wheat exports through the Black Sea, as well as shipments of Russian fertiliser, if western sanctions were eased, according to a Kremlin readout of talks with the president of Turkey.

"Whether it’s Ukrainian or outright Russian production, (Putin) sees that as an opportunity to alleviate some of the sanctions," said Dan Hussey, senior market strategist at Zaner Group.

The conflict between top grain exporters Russia and Ukraine since late February has roiled global grain markets and stirred increasing worries over a global food crisis.

Climbing soybean futures overnight spurred farmer selling and profit-taking as attention will soon turn from planting progress to growing season weather.

Recent rains across the Northern Plains and Midwest have prevented farmers from planting, as the ideal window for seeding nears an end.

"Spring wheat planting might not be as robust," said John Zanker, market analyst at Risk Management Commodities. "Same with corn. I just doubt we’re going to see trade expectations met in North Dakota, South Dakota, Minnesota."

The US Department of Agriculture in its weekly crop conditions and planting progress report graded 29% of the winter wheat crop in good-to-excellent condition by 29 May, and pegged spring wheat planting at 73% complete, versus the 5-year average of 92%.

Corn planting reached 86% planted, just one percentage point behind the 5-year average and ahead of analyst expecations, while soybean acres were 66% seeded, one point below analyst expectations.

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