Black Sea freeze spurs further headway in grain prices

Wheat prices made headway, sidestepping widespread commodity selling, as extreme Black Sea cold kept markets on edge, despite some reassurance over the last cold snap.

 

Commodities overall attracted selling, driving the Bcom index down 1.3%.

 

Silver slumped by 12.5%, as the appointment of Kevin Warsh as Federal Reserve chairman continued to ease jitters over debasement of the dollar, which recovered a further 0.2% against a basket of currencies.

 

Brent crude shed 2.4% after the Washington and Tehran agreed to hold talks in Oman on Friday, easing concerns over US-Iran tensions, and their potential for disrupting oil supplies.

 

However, milling wheat futures for March-26 edged 0.3% higher in Paris, returning above the $194.00/t mark, amid continued concerns over cold weather in Russia and Ukraine.

 

Temperatures last night fell below minus 30 Celsius in northern parts of Russia’s winter wheat belt, and a further night of unusual cold is expected before some retreat in the Arctic weather. Forecasts see potential for a return to cold temperatures early next week.

 

The cold spell raised fresh concern for crop damage, although Russian Deputy Prime Minister Dmitry Patrushev eased worries over setbacks from last month’s cold snap, saying that 97% of the country’s winter crops were in normal condition. “These are very good results,” he said, comparing the figure with an 87% reading a year ago.

 

The weather overshadows too Russian and Ukrainian wheat exports, which have set a disappointing pace so far in 2025/26.

 

London feed wheat futures for May-26 added 0.5% to return above their 20-day moving average, gaining extra support from a tumble in sterling.

 

The pound shed 0.7% against both the dollar and the euro as pressure rose on UK Prime Minister Kier Starmer from the fallout from the Peter Mandelson scandal, and as results of a Bank of England meeting, while keeping interest rates on hold, raised the chances of a cut next month.

 

Chicago soft red winter wheat futures for March-26 gained 1.7%, attracting spillover support too from a soybean market which continued to attract buying thanks to Donald Trump’s comments on Wednesday on the possibility of China buying further US exports of the oilseed.

 

Chicago soybean futures for March-26 stood up 1.6%, taking to 4% their two-session headway.

 

Oilseeds buoyancy fed through into rapeseed as well, which rose by 0.8% in late deals in Paris for May-26 delivery, poised for what would be the highest close in six months for a spot contract.

 

The contract has attracted technical support after breaking in the last session above its 200-day moving average, which had represented a stubborn resistance level.

 

There is some talk too of some tightening in European rapeseed oil stocks thanks to crusher downtime, including at the UK’s Erith plant.

 

US corn, soybean and wheat export sales data for last week all came in within the range of market expectations, although at the lower end, at 1.0Mt, 440Kt and 370Kt respectively.