On Monday, July 24, 2023, wheat futures in the USA surged by 8.6%, reaching a daily high on the Chicago Board of Trade (CBOT) after news about damages to Ukrainian ports on the Danube river.

Corn and soybeans also rose in response to the wheat futures, and the forecast of hot weather in the US agricultural belt added further support.

As of the evening Greenwich time, September CBOT wheat (WU3) exceeded the daily limit by 60 cents, reaching $7.57-1/2 per bushel, the highest level in a month. December corn futures rose by 32-1/2 cents to $5.68-3/4 per bushel, and November soybean futures rose by 24-1/4 cents to $14.26 per bushel.

“Russia continues to dump cheap wheat onto the world market, and with Brazil’s record crop, the world will be well-supplied with corn,” wrote Arlan Suderman, Chief Commodities Economist at StoneX, in a note to clients, as reported by Reuters. “But the long-term consequences of the export infrastructure destruction by a major world exporter have more serious implications,” Suderman added.

Ukraine significantly expanded grain exports overland through the EU after the conflict began last year, exporting around 1 million tonnes per month. The majority of these volumes were exported from Romanian ports and via the Danube river.

The European Union’s crop monitoring service further reduced its yield forecasts for this year’s harvest, citing dry and hot weather.

Ahead of the weekly US Department of Agriculture crop condition report, analysts surveyed by Reuters, on average, expected the government to rate 58% of the US corn crop as good to excellent, up 1 percentage point from the previous week, while soybean ratings remained unchanged at 55% good to excellent. The United States is the world’s second-largest exporter of corn and soybeans after Brazil.