Wheat Advances to One-Week High Amid Divisions Over Grain Deal

Wheat gained to the highest in a week amid confusion over the terms of renewing a key grain-export deal that allows Ukraine to ship crops from its Black Sea ports.

(Bloomberg) — Wheat gained to the highest in a week amid confusion over the terms of renewing a key grain-export deal that allows Ukraine to ship crops from its Black Sea ports.

Wheat futures traded in Chicago were up about 2% at $6.98 a bushel. Traders are watching to see whether the Black Sea Grain Initiative will be renewed when it expires later this week.

Moscow offered to extend the agreement for 60 days, but is yet to receive official reactions from all parties, Deputy Foreign Minister Sergei Vershinin said on Tuesday, according to Tass. Kyiv has pushed back on the proposal, saying that it contradicted the terms of the overarching agreement.

A 60-day extension would only be half the length of the previous two terms of the initiative, which was brokered by the UN and Turkey last July and extended in November. The agreement has significantly boosted Ukraine’s crop exports and helped to lower global food prices. Ukraine earlier said it wants the deal to be extended for a year.

Turkey called on the participants to renew the agreement.

Read more: Black Sea Crop Deal Aims for 120-Day Renewals as Talks Go On: UN

Vessels are still heading to and from Ukraine’s Black Sea ports, data posted by the UN show. Three inbound ships on Monday and four on Sunday cleared inspection to sail to Ukraine under the initiative. Three loaded vessels departed on Monday and at least six more have sailed so far on Tuesday, although they will still need to pass inspection in Turkey, according to the lineups.

Some wheat importers are bulking up on supply ahead of the grain deal’s expiry. Saudi Arabia bought about 1 million tons of wheat in a tender, double the amount it sought, according to results issued Monday. Algeria also stepped in for supply this week and Tunisia bought more than 200,000 tons in a tender Tuesday.

In other grains, corn rose while soy was little changed.

–With assistance from Kateryna Choursina and Patrick Sykes.

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