Wheat futures settled at their lowest price in five months on Friday after Russia and Ukraine signed deals that should boost exports of grain and fertilizer. The “unprecedented agreement” on the resumption of Ukrainian grain exports through the Black Sea is a “beacon of hope” in world that desperately needs it, United Nations Secretary-General António Guterres said at the signing ceremony in Istanbul, Turkey, on Friday, according to a UN press release.
The deal is expected to stabilize global food prices and bring “relief for developing countries on the edge of bankruptcy and the most vulnerable people on the edge of famine,” Guterres said. Russia and Ukraine, which have been at war since Russia invaded Ukraine in late February, signed separate agreements Friday with Turkey and the United Nations, according the Associated Press. The news contributed to a sharp decline in wheat prices, with the most-active September wheat contract
WU22,
-6.29%
W00,
-6.29%
settling at $7.59 a bushel, down 47 1/4 cents, or 5.9%, in Chicago. The settlement was the lowest for a most-active contract since Feb. 3, according to Dow Jones Market Data. December corn
CZ22,
-1.92%
C00,
-1.92%
also fell by 9 1/4 cents, or 1.6%, to $5.64 1/4 a bushel, the lowest finish since Nov. 9, 2021, but November soybeans
SX22,
+0.90%
S00,
+0.90%
settled at $13.15 3/4 a bushel, up 14 1/4 cents, or 1.1%. “The world should not be lulled into thinking wheat or corn will leave Ukraine any time soon,” Sal Gilbertie, president and chief investment officer at Teucrium Trading, told MarketWatch. “Signing a deal is one thing, but implementing the deal is an entirely separate matter.”
“ “The world should not be lulled into thinking wheat or corn will leave Ukraine any time soon.” ”
— Sal Gilbertie, Teucrium Trading
“This agreement benefits Russia immediately because shippers and insurers will gain comfort that Black Sea shipping lanes are open and safe, but it is only Russia that can immediately begin exporting its wheat and fertilizer,” he said. He pointed out that “Ukraine ports must be demined and damage to some Ukraine export facilities needs to be repaired, all of which will take considerable time.” Also, in a July report, the U.S. Department of Agriculture said Ukraine w …