Wheat futures on the Chicago Stock Exchange rose 4,2% after the announcement of Russia's withdrawal from the grain deal. Bloomberg writes about this.
“Russia has suspended the Black Sea Grains Agreement, increasing uncertainty over the world's food supply by closing a key export route for Ukraine, one of the world's top suppliers of Wheat and vegetable oil, has closed,” writes the publication.
At the same time, European wheat futures rose about 2%, Reuters reported.
"I believe the market is assuming that Russia and the EU have large wheat stocks that can meet global demand in the coming months while the harvest comes around," said a German grain trader.
Hasnain Malik, head of equity research at Tellimer Research, believes the price hike will hit the poorest countries.
“The suspension of the Black Sea Agreement is not unexpected and could end the recent softening in grain prices. This is bad news for smaller and poorest importers in emerging markets like Egypt.
On Monday, June 17, Russia announced that it would withdraw from the grain deal. The reason for this decision, according to the Kremlin spokesman, is that "the part concerning Russia is not yet fulfilled".
Source: Ukragroconsult (Ukraine)