Wheat predictions: How winding up grain deal blows up the price

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The world is "not optimistic" that the grain-export corridor that has allowed it to ship more than 30 million tons of crops amid the Russia - Ukraine tensions will be extended beyond July, the country’s infrastructure minister said Wednesday.

The efficiency of the Black Sea corridor is faltering and crop volumes are declining. Even if prolonged, it won’t be as helpful in offloading the nearing 2023 harvests in its current state.

"We are doing our best in order to maintain this initiative", - Mr. Kubrakov (who signed the deal) said.

The deal — which was brokered by the United Nations and Turkey — has helped lower world food prices and maintain a sector that is vital for Ukraine’s economy.

It is next up for renewal on July 17, nearby July, 2023 Wheat Futures contract expiration.
Russian President Vladimir Putin already signaled that his nation may quit the pact, though the UN has urged all parties to press on.

There are no prerequisites for extending the grain deal, Mr. Peskov, press secretary of the Russian President said on June 21.

The deal has recently been plagued by a persistent slowdown in ship inspections, and Russia’s refusal to approve vessels headed to one of the three ports it covers.
Some 1.3 million tons of crops were shipped via the corridor in May, less than a third of the peak in October, UN figures show.

The technical picture indicates, Wheat Futures contracts are heading up for the 5th consecutive weeks in a row, second time since Q1 2022, last time due to widely known tensions between Russia and Ukraine.

With almost 30 percent gain from 2023 low near 575 cents per bushel, the price breaking up 1/2-year simple moving average, with further upside opportunities, up to 800 cents per bushel.