War in Ukraine and cold weather in the US lead to lower supply forecasts, driving up grain prices.
Chicago Board of Trade (CBOT) corn futures topped $8 per bushel and hit their highest price in nearly a decade on Monday over concerns about unfavorable US weather and the Ukraine war disrupting grain exports.
Traders fear cold weather will reduce US crop planting this spring and could potentially reduce yields at harvest time in the fall. Forecasts show “only brief open windows for Midwest planting” through the end of the month, said Rich Feltes, head of market research at broker RJ O’Brien.
Planting is already off to a slow start, with 2 percent of the crop sown as of April 10, below the five-year average of 3 percent. The US Department of Agriculture will publish an update on the farmers’ progress in a weekly report at 3 pm CDT (2000 GMT).
“It looks like some corn will be planted before the end of April, but the war in the Ukraine continues,” said Dennis Smith, a commodity trader at Archer Financial Services in Chicago.
US grain production is particularly important this year because the war in ukraine it has cast doubt on its plantations and has stalled agricultural exports from the Black Sea region, a major world supplier of corn and wheat.
About 1.25 million tons of grains and oilseeds are still in commercial ships blocked in Ukrainian seaports due to the invasion of russiaand part of the cargo may deteriorate in the near future, Ukraine’s agriculture minister said on Friday.
Most active Cv1 corn futures rose as high as $8.03 per bushel on the CBOT, the strongest level since September 2012. As of 10:10 a.m. CDT (15:10 GMT), the contract was up 18-3/4 cents. at $8.02-1 /2 a bushel.
CBOT Sv1 soybeans gained 24 cents to $16.89-1/4 a bushel, while CBOT Wv1 wheat jumped 28-1/2 cents to $11.33 a bushel and approached a four-week high.
Wheat futures rallied after the most active Wv1 contract posted its biggest drop in nearly two weeks on Thursday. CBOT markets were closed on Friday.