Wheat prices tumble in world market after Russia Ukraine deal

Following a deal between Ukraine and Russia on Friday, the wheat prices have tumbled to levels last seen before Russia’s invasion.

Ukraine and Russia signed landmark deal aimed at relieving a global food crisis caused by blocked Black Sea grain deliveries, ending months of negotiations.

In Chicago, the price of wheat for delivery in September dropped 5.9 percent to $7.59 per bushel, equivalent to about 27 kilograms. Prices in Europe fell by a similar amount.

Russian Defence Minister Sergei Shoigu told Kremlin state media after attending the signing ceremony that he expected the deal to start working “in the next few days”.

He pointed out that Russia had managed to secure a separate pledge from Washington and Brussels to lift all restrictions on its own grain and other agricultural exports.

The European Union has called for the deal’s “swift implementation” while British Foreign Secretary Liz Truss said London “will be watching to ensure Russia’s actions match its words”.

The sides must first set up a joint command and control centre in Istanbul that monitors the ships’ passage and addresses disputes.

They have yet to finalise how the ships will be checked for weapons before returning empty to Ukrainian ports.

Ukrainian farmers who have been watching their silos fill up with grain that they cannot sell met the Istanbul deal with guarded hope.

The grain deal was signed one day after Russia’s restart of the Nord Stream natural gas pipeline eased concerns in Europe of a permanent shut off after a 10-day maintenance suspension.

The hostility between Moscow and Kyiv spilled over into the signing ceremony — delayed briefly by disputes about the display of flags around the table and Ukraine’s refusal to put its name on the same document as the Russians.

The two sides eventually inked separate but identical agreements in the presence of UN Secretary General Antonio Guterres and Turkish President Recep Tayyip Erdogan at Istanbul’s lavish Dolmabahce Palace.

“Today, there is a beacon on the Black Sea — a beacon of hope, a beacon of possibility, a beacon of relief,” Guterres said moments before the signing.

Erdogan — a key player in the negotiations who has good relations with both Moscow and Kyiv — said the deal would “hopefully revive the path to peace”.

The agreement includes points on running Ukrainian grain ships along safe corridors that avoid known mines in the Black Sea.

Huge quantities of wheat and other grain have been blocked in Ukrainian ports by Russian warships and landmines Kyiv has laid to avert a feared amphibious assault.

Zelensky said that around 20 million tonnes of produce from last year’s harvest and the current crop would be exported under the agreement, estimating the value of Ukraine’s grain stocks at around $10 billion.