Grain Traders Are Closely Eyeballing Black Sea Region Grain Shipping as Wheat, Corn Prices Fall

December soft red winter (SRW) wheat (ZWZ26) futures on Friday fell 20 1/4 cents to $7.34 and for the week were down 50 cents. December hard red winter (HRW) wheat (KEU27) futures lost 13 1/4 cents to $8.02 1/4 and for the week were down 42 cents. The winter wheat futures markets bulls did not want to go home for the three-day holiday weekend overly long wheat futures, especially as U.S. envoys were headed for Russia and Ukraine over the weekend to talk peace. Thus, they took some profits and evened positions. Russian President Vladimir Putin late last week said there may be a chance for peace.

Weekend news out of Russia and Ukraine saw uninspiring developments, however. Bloomberg reported Putin remains committed to continuing his war against Ukraine after his latest meeting with U.S. envoys Steve Witkoff and Jared Kushner. “Putin is determined to seize control of all of Ukraine’s eastern Donetsk region and believes Russia’s army can achieve this goal in the next six months. Ukraine has repeatedly rejected Putin’s demand to hand over a fortress belt of cities in the eastern Donetsk region as part of any deal to end the war,” said the report.

Ukraine’s Rebound and Russia’s Rerouting Leave Exports Costly and Uncertain

That’s the headline of a special weekend report from the respected grain market watcher and ag policy analyst Jim Wiesemeyer from the “Wiesemeyer’s Perspectives” podcast. “Ukraine is moving more grain through alternative export routes, but sharply higher freight costs are limiting the benefit. Meanwhile, Russia’s own port disruptions are restricting wheat shipments and forcing exporters toward Baltic outlets. Together, the developments point to a partial recovery in trade that remains expensive, vulnerable to delays and well short of normal capacity.”

Reuters on Monday reported Ukraine’s weekly wheat, corn and barley exports rose 80% to 433,700 metric tons during Aug. 27-Sept. 2. That is a substantial improvement, although shipments remain about 43% below the roughly 760,000 tons moving weekly in early July, based on the comparison in the supplied report. Wiesemeyer’s report said the recovery carries a steep transportation bill. The ASAP Agri update cited freight rates from Ukrainian Danube ports rising approximately $10 per ton to Marmara and eastern Greece and $20-$25 to Italy and Spain in one week. Barge rates increased by another 5 Euros per ton. Scarce vessels and longer waiting times are absorbing more of exporters’ selling prices.

Meantime, Russia faces a parallel export bottleneck, said Wiesemeyer. Its southern system depends on both deep-water ports, particularly Novorossiysk, and smaller Sea of Azov ports feeding vessels through the Kerch Strait. Kpler estimates that Azov-origin shipments account for approximately one-third of Russia’s seaborne wheat exports. Disruption there strains the wider network because rail, trucking, storage, and terminal capacity constrain how quickly grain can move through another outlet, he said. Russian exporters are consequently seeking Baltic routes.

“The latest overall assessment is that alternative routes are keeping grain moving, but have yet to restore the Black Sea’s normal competitive pressure on world markets. That supports demand for other origins and leaves buyers exposed to further freight increases. It does not mean all delayed grain is permanently lost: a sustained reopening could release accumulated supplies and renew price competition later in the season,” said Wiesemeyer.

Tuesday afternoon’s weekly USDA crop progress reports and the crop condition ratings will be closely scrutinized by grain traders. Traders are looking forward to this Friday’s monthly USDA supply and demand report.

Corn Sees Chart Consolidation, Profit-Taking

December corn (ZCZ26) futures on Friday fell 4 cents to $5.36 3/4 and for the week were up 1/4 cent. Prices Friday did close at a technically bearish weekly low close. The corn futures market hit a three-year high last week and then prices consolidated amid some profit-taking pressure. Given recent solid gains, the shorter-term speculative bulls likely lightened their positions heading into the three-day U.S. holiday weekend. 

World Weather Inc. last week said too much heat and dryness in the southwestern U.S. Corn Belt and Delta may be cutting into some yields. 

Harvesting and commercial hedge pressure could tap the brakes on the rally in the corn futures markets in the coming weeks. Lingering uncertainties regarding the Black Sea and Sea of Azov grain shipments will remain very market-sensitive for all the grains into at least the end of this year. Those export risks are compounded by already reduced supplies in the European Union after a severe drought in western Europe this growing season. Plus, there is concern that a strengthening El Niño could trim output in key Southern Hemisphere grain regions later this year.

Soybean Bulls Still Strong

November soybean (ZSX26) futures on Friday fell 6 1/2 cents to $13.09 3/4 and for the week were up 21 3/4 cents. December soybean meal (ZMZ26) futures fell $0.40 to $355.10 but hit a more-than-two-year high for the contract and for the week were up $6.20. 

The soybean and meal futures markets Friday saw some mild profit-taking pressure. Losses were limited as the USDA on Friday morning reported daily sales of 250,600 MT of U.S. soybeans for delivery to unknown destinations during the 2026-27 marketing year.

The expected mid-month summit meeting between President Donald Trump and Chinese leader Xi Jinping will be a major focal point for the soybean market. Tensions between the world’s two largest economies have risen in the past few weeks.

Let me know what you think. I enjoy hearing from my valued Barchart readers all around the globe. Email me at jim@jimwyckoff.com.

On the date of publication, Jim Wyckoff did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.