Global wheat market seems to be on crossroad at thsi point of time and move either unexpectedly down or up from current level.Wheat harvesting continues in Black Sea Region and Russian crop has been pegged at 50 million tonne.Wheat crop in Ukraine too is in excellent shape and both the countries supply 26 to 28 million tonne wheat to the global market.Russia is expected to supply 20 million tonne wheat to the world market from new crop.Ukraine too has 5 to 6 million tonne marketable surplus from new crop. Both the countries are major exporting source to the world market.
However,the latest development at political front hints towards emerging owesome situation for global wheat market.Trade sanction on Russia by US led countries folowing Malaysian plane crash might be a visible possibility and it may disrupt supply in the global wheat market.Russian exporters would try to strike as much deal as they can before the trade sanction gets implemented.it may flood global wheat market and wheat price may decrease beyond expectation.Impact on CBOT may be seen.
However,if trade sanction(likely)is applied soon,buyers have to move to other sources like US,Australia,Ukraine,Argentina and Canada.Russian absence from global market may lead to firmness in price as other exporting countries have to compensate 20 million tonne additional wheat to the world market.Despite global surplus of wheat,price would increase if Russian trade is restricted.
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