Is $10 wheat in sight?

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If Russia continues attacks on Ukraine grain ports, U.S. wheat futures could top $10 a bushel, according to traders who spoke with Agricensus.

Prices surged Monday on reports Russia had begun attacking ports along the Danube River. Those ports are being used as an alternative shipping route after Russia backed out of the Black Sea Grain Deal last week.

Chicago soft red wheat, Kansas hard red wheat, and Minneapolis hard-red spring wheat all surged above $10 a bushel after Russia’s initial invasion of Ukraine in February 2022. But prices backed off after the initial shock to the markets and the worst of the predictions didn’t pan out. They dropped farther after the corridor deal was signed in July that same year.

Last week, wheat prices climbed after Russia pulled out of the deal. What the markets were not anticipating this week were attacks on Danube ports. On Monday, the Chicago September contract settled at $7.57. The Kansas September contract ended at $9.25 and Minneapolis at $9.36.

The Chicago contract is the most-traded in the U.S. Agricensus reports the impact may be exaggerated because the market is net short, which is expected to lead investors to buy back positions.

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