As the Russia-Ukraine war threatens to halt shipments and sowing, corn price has risen towards $8 a bushel, the highest in 10 years.
Gatekeepers News reports that this is a result of Ukraine’s inability to ship and sow crops, while cold weather is stoking worries about a slow start to U.S. planting.
Meanwhile, the war has no sign of coming to an end soon as Russian President Vladimir Putin vowed to continue the invasion this week.
The war has continued to snarl grains trade out of the Black Sea region and could cut Ukraine’s next corn crop by about 40%. In a related development, futures in Chicago have rallied to the highest close since 2012 this week.
Nevertheless, buyers are likely to look toward the U.S. for supplies, but the initial pace of planting is marginally below the five-year average due to concerns that cold and wet weather could hinder early sowings.
According to CBA’s Gorey, corn is likely to exceed $8 in the coming months.
Gorey said, “The $8‑level is going to be more speed-bump than road-block” if there are real weather issues, according to Tobin Gorey, an agri-commodities strategist at Commonwealth Bank of Australia. Futures will pierce that “mythical” level at some point during the northern spring and summer.
Corn futures for July delivery rose as much as 0.5% to $7.81 1/2 a bushel and wheat also extended gains, advancing 0.8% to $11.30 a bushel.
