(TheLibertyRevolution.com)- Wheat prices are climbing after Russian President Vladimir Putin suspended the Black Sea agreement, according to a report from The Epoch Times. The decision is expected to cause a cascade of negative effects in the market.
The most active contract on the Chicago Board of Trade (CBOT) rose by 5.7% to trade around $8.77 a bushel, hitting a high of $8.93. Prices of corn and soybeans were also up.
“This is an inflationary move supporting prices of wheat and corn,” one Singapore-based trader told Reuters. “Prices have risen, but further gains will depend on how the situation unfolds.”
Ukraine is reportedly one of the world’s major suppliers of wheat. Shortly after Russia launched its “special military operation” grain shipments from Kyiv were halted.
The Black Sea Initiative was signed between Russia and Ukraine, Turkey, and the United Nations on July 22, allowing for the safe export of grain from selected ports.
Since the signing, more than 9.5 million tons of grain and foodstuffs have been exported. But Russia recently suspended the agreement after the country alleges that Ukraine is responsible for droning its Black Sea Fleet ships. Ukraine has denied responsibility for the attack.
The Russian ministry also reportedly attributed the attack to “British experts.” The decision reportedly puts tens of thousands of tons of wheat at risk as they are scheduled for delivery to the Middle East and Africa. Ukraine’s corn exports are also reportedly affected by the decision.
Ukraine’s Ministry of Foreign Affairs, Dmytro Kuleba, has tweeted that Russia “planned this well in advance,” noting that the Kremlin’s actions will halt exports already en route.
“The current queue with grain has accumulated in the Black Sea since September, when Russia started deliberately delaying the functioning of the corridor and seeking to undermine the deal. Russia took the decision to resume its hunger games long ago and now tries to justify it,” Kuleba said.