CHICAGO: Chicago wheat futures climbed to a two-week high on Monday, extending gains after the US government’s latest assessment of global supply and demand reflected the impact of the Ukraine crisis on Black Sea shipments.
The most-active wheat contract on the Chicago Board of Trade (CBOT) was up 1.7% at $10.75-3/4 a bushel, as of 0803 GMT, after rising to $10.86-1/4 a bushel earlier in the session, its strongest since March 28.
In its monthly supply and demand assessment released on Friday, the US Department of Agriculture (USDA) lowered global ending stocks by 3.09 million tonnes to 278.42 million tonnes.
Wheat prices have been particularly supported by the Russia-Ukraine conflict that has disrupted Black Sea shipments. Nearly 50 countries depend on Russia and Ukraine for at least 30% of their wheat import needs, according to the Food and Agriculture Organization (FAO).
Rising fertiliser costs, as top exporter Russia faces a swathe of Western sanctions over its invasion of Ukraine, have added to crop supply concerns. “Higher fertilizer prices today could lead to lower fertilizer use next season and possibly beyond, with the real prospect of lower food productivity resulting in even higher food prices,” Qu Dongyu, FAO’s director-general, warned on Friday in an address during a council meeting.
Amid tight supply and high prices, Kazakhstan has decided to restrict exports of wheat and flour from April 15 to June 15, the country’s agriculture ministry said.
Reiterating growing concerns about China’s reliance on food imports, Chinese President Xi Jinping said the country needed to be independent in seeds to achieve food security, state media reported on Monday.
CBOT soybeans were down 0.4% at $16.82-3/4 a bushel after touching $16.97-1/2 in early trade, their highest since March 28.
The USDA pegged US soybean stocks at 260 million bushels by Sept. 1, down 15 million from the previous forecast as harvest shortfalls in Brazil boosted export demand for US supplies.
CBOT corn rose 0.5% to $7.72-1/2 a bushel, extending gains to a third session.