Global wheat prices fell Thursday after Ukraine and Russia agreed to extend a deal allowing grain to be exported from Ukrainian ports in the Black Sea.
Wheat futures on the Chicago Board of Trade dropped 2% to $6.12 a bushel. Prices have fallen 23% since the start of the year, and 57% since hitting an all-time high of $14.30 a bushel in March last year.
"These agreements matter for global food security," António Guterres, secretary general of the United Nations, told journalists Wednesday. "Ukrainian and Russian products feed the world."
The grain deal, first signed in July, was due to expire on Thursday, but Turkish and Ukrainian officials said on Wednesday that it would be extended for another two months. Kremlin spokesperson Dmitry Peskov also confirmed on Thursday that Moscow had agreed to the renewal.
Russia had previously threatened to pull out of the deal, complaining about a related agreement with the UN to facilitate shipments of Russian grain and fertilizers.
Ukraine and Russia together account for nearly a third of global wheat exports, according to Gro Intelligence, an agricultural data firm. They are also among the top three global exporters of barley, maize, rapeseed oil and sunflower oil.
Following its full-scale invasion of Ukraine in February last year, Moscow blockaded crucial grain shipments from the country's Black Sea ports. That meant that millions of tons of the region's grain went undelivered to the many countries that rely on it.
In the days after the invasion, global wheat prices skyrocketed, with the UN's Food and Agriculture Organization warning that as many as 47 million people could be pushed into "acute food insecurity" because of the war.
But the July grain deal and its renewals have helped "stabilize markets and reduce volatility", the United Nations Conference on Trade and Development, an intergovernmental body, said in a press release on Wednesday, noting that global food prices had fallen 20% since hitting all-time highs in March 2022.
— Anna Chernova contributed reporting.