The rocket impact in Poland near the Ukrainian border seems to have had only a limited effect on the grain market for the time being. However, much is still unclear and most of the parties directly and indirectly involved urge people to rest and do not want to make hasty decisions. That inspires confidence in players in the grain market, at least for now.
The Matif closed yesterday €4,50 lower at €319,50 per tonne. The stock exchange in Paris was already closed when the news about the missile in Poland came out. This morning the Matif opened at €320,75 per tonne. that is a limited increase. The wheat quotation on CBoT - which was open when the news from Poland became known - showed a cautious increase in the last trading session. The December wheat contract closed 1,2% higher at $8.28,25 per bushel (about €292 per tonne). Corn closed 1,4% higher on the American stock market and soy rose 1,2%.
Look here for the current rates
It is still unclear whether the rocket that landed in NATO member Poland, killing two, came from Russia. Poland announced yesterday that it was most likely a Russian missile and summoned Russia's ambassador to provide explanations. The Kremlin denies involvement in the attack. According to the Russian Ministry of Defense, images of the impact show that the debris is from a Ukrainian anti-aircraft missile, the Russian news agency RIA reports. NATO ambassadors met in Brussels on Wednesday for an emergency meeting about the incident in Poland. The members of the alliance first want to wait for the investigation into what exactly happened. US President Biden said that based on initial information it may not be a missile fired from Russia. The attack has led to major tensions at an international level. If it were a Russian missile, it could be considered an attack on a NATO member.
No empty promises
Analysts expect that the grain deal that is to be extended this week will not be jeopardized by the events in Poland. Today the Russian newspaper Izvestia published an interview with State Secretary for Foreign Affairs Sergei Vershinin in which he appears to be pushing for an extension of the deal. "We are not blind to the humanitarian side of the deal and these are not empty promises." According to Vershinin, an important condition for extending the deal is that the state-owned bank Rosselkhozbank regains access to SWIFT, the international payment system. The agricultural bank plays an important role in handling Russian grain and fertilizer exports.
Partly due to all the unrest in the Black Sea region, the EU is exporting significantly more wheat. This season, 13,35 million tons of wheat were exported, according to figures published this week by the European Commission. This means that exports are almost 10% ahead of the previous season.
View the overview of grain prices and the technical analysis here