Chicago | Reuters—Chicago Board of Trade wheat futures rallied on Tuesday amid mounting geopolitical tensions and signs of tightening supplies from the Black Sea, market analysts said.
Corn futures set new 3-month highs on support from wheat, and as oil prices jumped on Tuesday, after the Israeli military said on Tuesday that missiles had been launched from Iran at Israel and NATO’s new chief Mark Rutte voiced strong support for Ukraine.
That energy rally, along with drought impacts in key wheat growing regions, helped neutralize potential grain market impacts from news of the U.S. East Coast and Gulf Coast dockworkers going on strike on Tuesday, said Mike Zuzolo, president of Global Commodity Analytics.
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Meanwhile, CBOT soybeans traded both sides of unchanged on technical moves, analysts said.
The most active CBOT wheat contract Wv1 settled up 15 cents at $5.99 a bushel, after earlier climbing to $6.02-1/2 a bushel, its highest since June 17.
CBOT corn Cv1 settled up 4-1/4 cents at $4.29 a bushel, after earlier hitting $4.32-3/4 a bushel, the highest price since June 28. Soybeans Sv1 ended up 1/4-cent at $10.57-1/4 a bushel.
In addition to the geopolitical tensions, wheat futures gained support from news that wheat export prices in Russia rose last week even as the pace of shipments picked up amid signs of Ukraine’s crop being smaller than expected.
“The off-shoots of the Black Sea drought appear to finally be emerging,” Zuzolo said.
Russia raising its prices on wheat also lent support to futures on the day, as did reports of further drought conditions, said Jack Scoville, vice president at the Price Futures Group.
Russia’s Voronezh region, one of the country’s key farming areas for grain and sugar beet, on Tuesday declared a state of emergency due to drought, the local agriculture ministry said.
—Additional reporting for Reuters by Peter Hobson and Sybille de La Hamaide
