Euronext Wheat Rebounds as Ukrainian Strikes Hit Russian Grain Terminals

Euronext wheat futures rose on Wednesday, rebounding from four-week lows, after Ukrainian drone strikes on Russian grain terminals stoked fears of significant disruptions to Black Sea shipments.

Black Sea Tensions Drive Prices

The attacks prompted two of Russia's largest grain terminals in the port of Novorossiysk to suspend operations, according to reports. This escalation threatens a major artery for Russian wheat exports to global markets and could shift demand to other suppliers.

The market reacted to the heightened geopolitical risk. Key price movements included:

• December wheat, the most active contract on the Euronext exchange, rose 2.2% to €232.50 ($268.35) per metric ton as of 1517 GMT.
• September wheat saw a sharper increase, climbing 3.5% to €220.75 per ton.

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Market Context

According to traders and analysts, the gains in European wheat were more modest than those seen in Chicago wheat futures. The rally on Euronext was reportedly tempered by persistent weak export demand for Western European grain.

Analysts also pointed to an already large long position held by investment funds in Euronext wheat, which may have limited the potential for further buying. Some of the day's activity was attributed to short-covering, as traders exited bearish positions ahead of the August 17 options expiry for the September contract.