Ukraine war sends wheat prices soaring 25% this week to 14-year high, Latest Business News - The New Paper

Ukraine war sends wheat prices soaring 25% this week to 14-year high

Russia's invasion of Ukraines has sent wheat prices soaring to a 14-year high, exacerbating already high food prices.

Wheat futures on the Chicago Board of Trade (CBOT) rose 5.1 per cent on Thursday (March 3), reaching prices not seen since 2008.

The higher prices make wheat more expensive for food makers, who will likely pass the higher costs on to consumers.

Damage to Ukraine's export infrastructure following Russia's invasion has raised concerns over longer-term disruptions to supply from the Black Sea region.

The most-active wheat contract on the CBOT eased to below US$11 (S$14.9), after climbing to its highest since March 2008 at US$11.34 a bushel earlier in the session.

Wheat futures have rallied around 25 per cent in just four sessions.

Corn rose 1.8 per cent to US$7.38 a bushel and soybeans climbed 0.8 per cent to USUS$16.76 a bushel.

Russia and Ukraine account for about 29 per cent of global wheat exports, 19 per cent of corn exports and 80 per cent of exports of sunflower oil, which competes with soy oil.

Ukraine has suffered damage to its ports and other export facilities with Russian troops invading the country, while Western sanctions have hit Russian supplies.

Russian troops are in the Ukrainian port city of Kherson and forced their way into the council building, the mayor said after a day of conflicting claims over whether Moscow had made the first major gain of a city in its invasion that began eight days ago.

The United States is preparing a sanctions package targeting more Russian oligarchs as well as their companies and assets, two sources familiar with the matter said on Wednesday, as Washington steps up pressure on Russian President Vladimir Putin.

The European Union will consider letting farmers use fallow land, notably to grow protein crops for livestock feed, to counter disruption to supply from Ukraine, officials said. - REUTERS