Reuters is reporting that European wheat futures rose to a two-week high on concern that the crash of a Malaysian Airlines passenger plane in Ukraine will deepen geopolitical tensions. The fears of an escalation in tensions after new U.S. sanctions against Russia had already hit financial markets also impacted on U.S. wheat markets. Prices are on track for their biggest weekly gain in four months due to concern over supplies from the Black Sea region, a big grain exporter.


Sal Gilbertie of Teucrium Trading told Agriculture.com  "I think it is a very fluid situation and far too early to predict sanctions, but any disruption in Black Sea wheat would immediately take away a very competitive source of global wheat supplies, which means buyers would likely turn back to the U.S., the EU, and Australia for their ongoing wheat purchases. Perfect supply conditions had been priced into the grain markets up until today’s news, so any excuse for shorts to cover and buyers to secure some supply at current prices will likely cause significant impact to prices, at least in the short-term."


Bloomburg are reporting that CBoT prices jumped 2.4 percent yesterday, the biggest increase since April 15. Futures are set to advance 5.4 percent this week, the biggest weekly gain since the period ended March 7.

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