MercoPress. South Atlantic News Agency

Price of wheat slumps following Black Sea truce

Let us hope that a spiral for peace will be opened with this agreement,” Erdogan said.

The price of wheat in global markets went back to pre-war figures Friday, after Ukraine and Russia agreed on a truce to allow for the departure of exports from Black Sea ports under Kyiv's control.

Ukraine and Russia together account for 30% of the world's wheat trade.

The document was signed in Istanbul and it was the result of negotiations undertaken by Turkish President Recep Tayyip Erdogan.

Read also: Ukraine, Russia agree on safe corridor for wheat exports

Wheat prices fell sharply in Chicago, where the bushel of wheat (about 27 kg) for September delivery went down 5.86% to US$ 7.5900. On Euronext, wheat closed at € 325.75 a ton for September delivery, a 6.41% decrease.

“I didn't expect it at all, given that the Russians are advancing eastward and approaching the port of Odessa,” Michael Zuzolo, president of brokerage and analysis firm Global Commodity Analytics and Consulting, told AFP. ”The market reaction suggests that there was a premium on the (price of) wheat in the market, particularly in Europe and to a lesser extent on futures contracts in Chicago“ and now ”this premium is being removed,“ he argued.

Russian Defense Minister Sergey Shoigu signed the document on behalf of his country at Istanbul's luxurious Dolmabachce Palace. When he left the room, Ukrainian Infrastructure Minister Oleksandr Kubrakov walked in and signed his part of the deal alongside Turkish Defense Minister Hulusi Akar. In addition to Erdogan, also present at the meeting was United Nations Secretary-General Antonio Guterres.

”I have already said that this war will have neither victors nor vanquished, the only defeated will be the world. The effect of the war reverberates all over the planet. Let us hope that a spiral for peace will be opened with this agreement,” Erdogan said.