Wheat futures jumped after Russia’s president, Vladimir Putin, threatened to restrict Ukraine’s newly-resumed grain shipments, claiming that exports are heading to the European Union rather than developing nations.

Chicago wheat futures, the world benchmark, for December leaped 6.9% at one point before easing back to $8.49 a bushel in late deals, a gain of 3.9% on the day.

Hard red winter wheat futures for December stood up 2.6% at $9.04 ¾ a bushel, while in Paris, soft milling wheat for December settled up 3.1% at E328.75 a tonne, having earlier touched a six-week high of E333.00 a tonne.

London feed wheat futures for November settled 2.5% higher at £271.00 a tonne.

‘Brazen deception’

The leap followed a warning by Mr Putin that he wished to “amend” July’s UN-brokered deal which has permitted safe passage for grain shipments from Ukraine, despite Russia’s invasion of the country.

The Russian president said that Russia, and the developing world, had been “cheated” by the agreement, in that the deal had, he claimed, boosted shipments to the EU, as well as Turkey, rather than importing countries.

“What we see is a brazen deception… a deception by the international community of our partners in Africa, and other countries that are in dire need of food,” he told an economic forum in eastern Russia on Wednesday, terming the agreement a “scam”.

“If we exclude Turkey as an intermediary country, practically all the grain exported from Ukraine is sent not to the poorest developing poorest countries but to EU countries,” he said, reporting that of 87 grain shipments which had left Ukraine, only two had headed for poor countries.

According to the UN, the Ukraine port agreement has enabled 204 “voyages”, of which 108 were inbound, and 96 outbound, with total exports facilitated hitting 2.21m tonnes.

Turkey has been the most frequent destination for Ukrainian grain exports, with China, Djibouti, Egypt, India and Somalia also on the roster.

‘Russia may take actions’

According to some reports, Mr Putin’s proposed amendments including a wish to revise the export deal by excluding wealthy nations from receiving Ukrainian grain.

“Putin said he wants to revisit the deal to discuss potentially changing its terms, including which countries could receive Ukrainian ag products, which prompted the rally in wheat,” said US broker RJ O’Brien.

While Ukraine has said it is complying fully with the agreement, there was concern nonetheless that “Russia may take actions detrimentally impacting the agreement”.

Chicago-based Futures International noted that “Russia recently has been struggling to secure wheat shipments”, thanks to “logistical and payment problems.

“Russia demands payment in roubles instead of dollars, making it harder for banks to back grain, and fertilizer, deals.”

EU import data

European Commission data show that the European Union has in 2022-23, as began at the start of July, imported 209,668 tonnes of Ukrainian wheat, as of September 5, a figure up 70% year on year, although representing only a fraction of the bloc’s trade in the grain.

EU soft wheat exports total 6.1m tonnes over the same period.

More focus will be on EU corn imports, in the face of expectations of the bloc’s smallest harvest in years.

EU corn imports from Ukraine as of September 5 totalled 1.52m tonnes, more than double the 670,000 tonnes imported as of the same period last season. EU corn exports over the same period reached 218,000 tonnes, a drop of 8.8% year on year, commission data show.