Black Sea developments continue to fuel futures market volatility
Futures markets continue to react to developments in the Russia/Ukraine War.
Farmers Business Network Senior Commodity Analyst Rejeana Gvillo tells Brownfield market volatility in the last six months has been linked to uncertainty in the Black Sea region and prices took another swing Sunday night into Monday’s session- this time on the plus side. That was a result of Russia pulling out of an agreement that until now allowed grain to move safely through the region.
“Markets are up about 50 cents, at least for winter wheat. Spring wheat is not responding as positively. I think this is also helping lift futures markets in general.”
Gvillo says the downside is US wheat and corn are not competitively priced on the global market
“The global situation is like ‘oh my goodness exports could be even more restricted’. But the bottom line is the US is still expensive and so we are probably going to be a last resort for some of these importers.”
She says even if importers do turn to the US, transportation challenges stemming from low water levels on the Mississippi River might not allow for timely exports.