Wheat Futures Mixed as Black Sea Tensions Offset by Profit-Taking, US Crop Data

Wheat futures traded in a mixed pattern on Thursday, with the market balancing a growing geopolitical risk premium against technical selling and signs of a robust U.S. spring wheat crop.

Black Sea Tensions Escalate

Bullish sentiment was driven by escalating attacks by both Russia and Ukraine on grain ships and port infrastructure in the Black Sea and Sea of Azov, fueling concerns over the stability of global grain supplies. According to Ukraine’s agriculture minister, the increased risk has led shipowners to temporarily suspend vessel arrivals at the country's Black Sea ports, disrupting agricultural export flows from the key region.

US Supply Outlook and Profit-Taking Cap Gains

Countering the supply fears, market gains were limited by traders taking profits after several contracts recently touched life-of-contract highs. This technical selling pressure was compounded by a favorable crop forecast in the United States. An annual crop tour in North Dakota projected an average yield for hard red spring wheat at 48.0 bushels per acre in the northwest and north-central parts of the state. This figure is above both last year's 47.1 bushels and the five-year average of 43.8 bushels, suggesting ample domestic supply.

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Meanwhile, the U.S. Department of Agriculture (USDA) reported net U.S. wheat export sales of 290,016 metric tons for the week ending July 16. The figure fell squarely within trade estimates of 200,000 to 550,000 tons, having a relatively neutral impact on the market.

Market Snapshot

By the close of trading, the divergent pressures were reflected in prices across different wheat classes:

• CBOT September soft red winter wheat settled up 1-1/2 cents at $7.07-1/4 per bushel.
• Kansas City September hard red winter wheat fell 1 cent to $7.62-1/2 per bushel.
• Minneapolis September spring wheat declined 1-1/2 cents to $7.27-1/2 per bushel.