EUROPE NEWS

Wheat prices soar for a third day as Russia-Ukraine tensions stoke fears of major food crisis

PUBLISHED THU, JUL 20 2023 • 8:21 AM EDT

Sam Meredith
@SMEREDITH19

KEY POINTS
• Wheat prices rose for a third straight day on Thursday after Russia threatened to treat ships heading for Ukrainian ports as military cargo carriers.
• It comes shortly after the Kremlin pulled out of the Black Sea Grain Initiative, a critically important wartime deal that provided a maritime humanitarian corridor for the export of Ukrainian grain.
• Russian forces have launched extensive missile and drone attacks against port and grain infrastructure in southern Ukraine in recent days.

Wheat prices rose on Thursday after Russia threatened to treat ships heading for Ukrainian ports as military cargo carriers, deepening fears of a global food security crisis. ... It marks the third consecutive day of price rises. The most actively traded wheat contract on the Chicago Board of Trade was last seen trading around 1.4% higher at 737.6 cents per bushel, notching a three-week high.

It follows a jump of 8.5% in the previous session, the biggest daily gain in more than a year, on mounting geopolitical tensions. Wheat prices remain well below the peak levels of 1,177.5 cents per bushel reached in May of last year, however. ... The rise follows the Kremlin’s decision Monday to pull out of the Black Sea Grain Initiative, a critically important wartime deal that provided a maritime humanitarian corridor for the export of Ukrainian grain.

U.N. chief António Guterres said he “deeply” regretted Russia’s decision to terminate the initiative, which in effect ended a “lifeline” for hundreds of millions across the globe facing hunger, as well as those already struggling with spiraling food costs. ... European Union foreign policy chief Josep Borrell said Thursday that Russia’s decision to pull out of the pact would imperil global food security. ... “What we already know is that this is going to create a big and huge food crisis in the world,” Borrell said Thursday ahead of an EU foreign minister’s meeting.

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