Grains: U.S. wheat falls to pre-Ukraine war levels; corn, soy also drop

Value Exchange International

01/07/2022 17:34

(Rewrites throughout with U.S. market open, adds quote, updates
prices, adds byline, changes dateline, previous PARIS/BEIJING)
    By Karl Plume
    CHICAGO, July 1 (Reuters) - U.S. wheat futures tumbled on
Friday to levels not seen since Russia's invasion of Ukraine
disrupted flows from the Black Sea breadbasket region, pressured
by a firmer U.S. dollar and rising global supplies from the
northern hemisphere's harvest.
    Soybeans and corn retreated in tandem with wheat in risk-off
trading ahead of the long U.S. Independence Day holiday weekend
and worries about tepid demand and the broader economy.
    Soaring inflation and a rush by central banks to raise rates
and stem the flow of cheap money has fueled sell-offs across
markets, pressuring grains prices that had spiked to near record
peaks following Russia's invasion.  MKTS/GLOB 
    "The outside markets are certainly a factor, especially if
you're talking about a Federal Reserve policy shift and a dollar
that's exploding higher," said Mike Zuzolo, president of Global
Commodity Analytics.
    Benchmark Chicago wheat futures  Wv1  have fallen nearly 40%
from a peak in March as some grain shipments have begun to flow
from Ukraine and as accelerating winter wheat harvests across
the northern hemisphere bolster supplies.
    "When the Ukraine issues started happening, we had to
aggressively price-ration the old crop ... Now that all this
new-crop harvest is coming to market, we don't have to price
ration so aggressively," said Craig Turner, senior ag broker at
Daniels Trading.
    CBOT September wheat  WU2  was down 27 cents at $8.57 a
bushel at 11:25 a.m. CDT (1625 GMT), the lowest since late
February.
    New-crop November soybeans  SX2  fell 56 cents to $14.02 a
bushel, while actively traded December corn  CZ2  shed 10 cents
to $6.10-3/4 a bushel, a four-month low.
    After initially rising following Thursday's U.S. Department
of Agriculture acreage report, the market was waiting to see if
the drop to soybean planting would be amended.  urn:newsml:reuters.com:*:nL1N2YH1Y4
 urn:newsml:reuters.com:*:nL1N2YH1TL
    Grain traders are also monitoring rain forecasts next week
for drought-parched areas of the Midwest.

 (Reporting by Karl Plume in Chicago; Editing by David Gregorio)
 ((karl.plume@thomsonreuters.com; +1 313 484 5285; Reuters
Messaging: karl.plume.thomsonreuters.com@reuters.net))