Russia’s worst drought on record has devastated crops in parts of the country and sent international grain prices soaring as markets placed bets that without shipments from one of the world’s leading exporters, global supplies would be restricted.
Wheat has risen seven of the past eight days at the Chicago Board of Trade and buying by funds and traders spilled across the grain markets. Corn and soybeans were 2 and 0.5 percent higher, respectively.
Prime Minister Vladimir Putin signed an order banning grain and flour exports from August 15 to December 31, with a spokesman saying this would apply to contracts that had been already signed.
The news confirmed an earlier report from Interfax that kicked off the buying.
“Putin’s announcement has everyone in a panic. It’s money chasing money, and who knows how high we could go,” said Paul Haugens, vice-president for Newedge USA.