Wheat prices spiked after Russia said it was pulling out from a wartime agreement to allow grain exports from Ukraine, one of the world’s biggest producers, through the Black Sea.
Chicago wheat futures, a global bellwether for wheat pricing, soared 7 per cent early Tuesday AEST, hitting a two-week high on the back of the news. Prices steadied in the afternoon at around $US6.50 a bushel after falling 1.8 per cent earlier in the day.
Russia’s foreign ministry said in a statement that the pact would cease to be effective as of Tuesday. With Ukraine one of the world’s top grain and vegetable oil exporters, the corridor’s shutdown is expected to hit key buyers like China, Spain and Egypt.
Agribusiness lender Rabobank said to expect more volatility in the price of the soft commodity in the coming weeks, as markets attempted to decipher what Russia’s withdrawal from the deal will mean for global supply.