Russia's influence on the grain market has been greater at times. Putin has his Turkish colleague Erdogan over to talk about the grain deal, among other things. The fact that the grain deal is being discussed again does not mean that the Kremlin has stopped attacking Ukrainian ports. A drone attack on the Danube port of Izmajil came fearfully close to NATO territory. The market, meanwhile, is moving sideways.
The wheat contracts on the Matif have been moving mainly sideways so far this trading session. The September contract is €0,75 lower at €220,50 per tonne. The remaining contracts for the 2023 harvest are down €0,25. The CBoT is closed today due to Labor Day.
Russia is open to negotiations on the Black Sea grains deal. Russian President Putin informed Turkish President Erdogan of this during the meeting between the two in Sochi. Last July, Russia withdrew from the grain deal because the Kremlin felt that grain and fertilizer exports were being made more difficult by Western sanctions. And in view of the high grain prices, it had been agreed that Russian agricultural goods would be given free access to the world market.
More interests
In the old grain deal, Erdogan also played an important role in getting Russia behind the agreement. In addition to the grain deal, gas deliveries are also on the agenda. Erdogan hopes to complete negotiations on Turkey's role as a gas hub. With such interests on the table, it is not surprising that Turkey has traveled with a heavy delegation. Reuters reports that Erdogan's entourage also included the Turkish Minister of Economic Affairs and the president of the central bank to the seaside resort on the 'Russian Riviera'.
The fact that Russia is once again opening the door to negotiations on the grain deal does not mean that the attacks on Ukraine have stopped. Last night there was another drone attack on the port of Izmajil. That has happened before, but what makes this attack different is that, according to the spokesperson for the Ukrainian Ministry of Foreign Affairs, a drone crashed and then exploded on Romanian territory. However, NATO member Romania denies this and there are no other independent sources supporting the Ukrainian claim.