(Bloomberg) -- Wheat rose to near the highest in a month in Chicago as an attack on a Ukrainian grain facility rekindled concerns about potential Black Sea supply disruptions.
A missile hit a facility owned by merchant Louis Dreyfus Co. in Odesa on Wednesday, though the company doesn’t expect repair work to materially disrupt terminal operations.
A key grains producer and exporter, Ukraine’s ability to ship goods has contributed to market volatility since Russia launched its invasion. The crucial export hub of Odesa has been repeatedly attacked by Moscow in an effort to curb Kyiv’s income, though grain shipments have remained resilient recently.
Wheat futures climbed for a second day, rising as much as 2.1%, before paring some of the gain.
The Black Sea has again become Ukraine’s main export route, as the country opened its own sea corridor after Russia pulled out of a deal guaranteeing safe movement of vessels. Still, Ukraine’s exports are expected to decline this season amid smaller harvests.
Wheat has rebounded roughly 10% since late July on prospects for a smaller European harvest, including from France and Russia, though US supplies look ample. There are also signs of robust demand, with buyers Egypt and Algeria recently issuing tenders to buy grain.
--With assistance from Áine Quinn.
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