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Black Sea uncertainty, tariff threats impacting wheat

An ag economist says the wheat markets have been hesitant amid some Black Sea uncertainty.

University of Missouri’s Ben Brown says, “There was a lot of talk around the Russia-Ukraine situation. The U.S. was in Saudi Arabia with Russia trying to broker a peace deal. It seems like there’s some movement happening in that market but that’s been kind of bearish to the wheat complex.”

He tells Brownfield if Russia and Ukraine are able to negotiate a security deal, similar to the Black Sea Grain Initiative, it likely won’t have much of an impact on the amount of wheat on the global market.

“But it probably does two things. That will lower the freight cost and make Russian wheat more competitive on the global market. The reverse of that is it probably strengthens the Russian ruble a little bit, which makes wheat a little less attractive.”

Brown says additional pressure to the wheat market has come from ongoing tariff threats.

He made his comments during Brownfield’s Weekly Commodity Market Update, which can be viewed below.