Chicago futures for the grain have soared more than 40% — the most ever — as Russia’s war in Ukraine upends global grain supplies. That puts prices at a 14-year high, and milling wheat in Paris reached an unprecedented 400 euros ($438 per ton).
The war is stalling shipments from one of the world’s most vital breadbaskets. Ukraine and Russia together account for a quarter of global trade of the staple, used in everything from bread to couscous and noodles. The conflict has closed major ports in Ukraine, and severed logistics and transport links. Trade with Russia has also been stifled by the complexity of navigating sanctions and soaring insurance and freight costs.
That leaves grain importers flocking elsewhere, sparking “unprecedented” demand for spot supply, according to adviser Agritel in Paris. Corn is also nearing a decade high, and soybean oil reached a fresh record on Thursday.
“When you have two of the biggest wheat exporters fighting, you have a disruption because we don’t know how much they will export,” said said Jack Scoville, vice president of Price Futures Group Inc. in Chicago. “Prices are going to be higher until the situation is resolved.”
Wheat futures jumped by the exchange limit in Chicago on Friday for a fifth straight day, rising 6.6% to $12.09 a bushel. Some forecasts point to prices moving even higher, and volatility in the options market has run wild.
Hard red winter wheat futures touched the highest since 2008 on Friday. Prices were on course for a gain of more than 30% this week, the biggest jump in records going back to 1970.