PARIS/HAMBURG: Euronext wheat dropped around 3 percent on Wednesday as the market saw signs of progress in diplomatic efforts to end the Russian war in Ukraine, which has choked massive Black Sea grain trade, traders said.
December wheat on Euronext was 2.9 percent down at €234.50 (USD263.09) a metric ton at 1521 GMT, after earlier falling to a three-week low at €232.50. Chicago wheat was down about 2 percent after earlier setting a fresh two-month low.
Russian President Vladimir Putin has agreed to resume US-mediated peace talks with Ukraine as soon as next month, the Kremlin said on Wednesday after Putin met US envoy Steve Witkoff.
Ukrainian President Volodymyr Zelenskiy, who held separate talks with Witkoff on Tuesday, said he was in favour of a ceasefire and three-way talks between Kyiv, Washington and Moscow. The comments “clearly” weighed on prices by raising expectations of potential de-escalation in the conflict, a futures broker said.
Wheat prices have already fallen in the past month as a partial recovery in Russian exports, using alternative routes via the Baltic Sea, and favourable prospects for upcoming Southern Hemisphere harvests eased supply concerns.
“Even without a (peace) deal Russian exports are expanding, especially via the Baltic,” a German trader said.
“Market forecasts are that Russia will export up to 2.8-3 million tons of wheat in October against around 5 million tons usually at this time of year.”
With supply concerns subsiding, there was little reaction to news that Egypt’s state grain buyer purchased about five cargoes of wheat this week, one of its first known imports in months, traders said.