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Russia exits the grain deal: Chicago wheat rises, then falls

Jul 2023

The lesson: Chicago SRW wheat (ZW=F) rose 4.6% from Jun to Jul 2023 month-end, then stood 14.9% below June by September. The later decline does not show that leaving the grain deal had no bullish effect; prices might have fallen further without it.

What happened

The Black Sea Grain Initiative, signed 22 Jul 2022 by Russia, Ukraine, Turkey and the UN, reopened Odesa, Chornomorsk and Pivdennyi under a Joint Coordination Centre — about 32.9 Mt of grain shipped to 45 countries (EU EEAS). Russia had been progressively slowing inspections for months. On 17 Jul 2023 it withdrew, ending the deal; days later it struck Odesa-region and Danube port infrastructure. By October 2023 Ukraine was running its own corridor without Russia.

Weather context
  • Ukraine (Black Sea centroid, Odesa area) (Jun-Dec 2023): +2.02°C vs the 1991–2020 baseline; rainfall +13.8% vs baseline (178 days with <1mm rain). Hot but not dry in this window: +2.0 C vs baseline with rainfall above normal.

One region centroid is illustrative, not field-level truth; baseline is the 1991–2020 day-of-year mean. Weather data provided by Open-Meteo.com.

What everyone expected

Farmers Weekly (17 Jul 2023): wheat prices jump as Russia halts the deal. After late-July strikes on Odesa and the Danube, Bloomberg (27 Jul 2023): wheat hit a five-month high — the fear was a fresh bout of destabilizing global food inflation.

What the official numbers expected · USDA WASDE (as-published vintages)

What the official numbers said at the time (USDA WASDE vintages, as published): the June 2023 vintage projected world wheat ending stocks of 271 Mt for 2023/24. After the exit, July cut that to 267 Mt and August to 266 Mt - a roughly 2% downward revision, not the supply cliff the July price rally priced. (USDA WASDE, world wheat supply/use, 2023/24 marketing year, million metric tons; vintages released 9 Jun, 12 Jul, 11 Aug 2023.)

As reported at the time: Farmers Weekly, 17 Jul 2023 · Bloomberg via Moneyweb, 27 Jul 2023

Observed prices and measurement limits

These are changes in the named benchmarks over the stated windows, not estimates of the event’s effect. Endpoints omit interim moves. A supply shock may have kept prices above where they would otherwise have been, even if the measured change is negative.

  • Wheat
    Jun 2023 → Jul 2023 · CBOT Chicago Soft Red Winter wheat futures (ZW=F) month-end closes
    Benchmark: Chicago SRW; not a matched Black Sea milling-wheat, KC HRW, or spring-wheat price. Protein, end use, and crop calendar affect comparability. Generic futures series; delivery months, roll dates, and roll adjustment are not documented in the bundled data.
    +4.6%

    Chicago SRW wheat rose over the exit month. Month-end observations do not capture the full sequence of daily or intraday moves.

  • Wheat
    Jun 2023 → Sep 2023 · CBOT Chicago Soft Red Winter wheat futures (ZW=F) month-end closes
    Benchmark: Chicago SRW; not a matched Black Sea milling-wheat, KC HRW, or spring-wheat price. Protein, end use, and crop calendar affect comparability. Generic futures series; delivery months, roll dates, and roll adjustment are not documented in the bundled data.
    -14.9%

    Chicago SRW wheat was lower at September month-end than in June. That net decline cannot establish the sign or size of the exit’s effect.

  • Corn
    Jun 2023 → Sep 2023 · ZC=F month-end closes
    -14.0%

    CBOT corn fell over the same window; attribution to the grain-deal exit is not established.

  • Wheat
    Jun 2023 → Dec 2023 · CBOT Chicago Soft Red Winter wheat futures (ZW=F) month-end closes
    Benchmark: Chicago SRW; not a matched Black Sea milling-wheat, KC HRW, or spring-wheat price. Protein, end use, and crop calendar affect comparability. Generic futures series; delivery months, roll dates, and roll adjustment are not documented in the bundled data.
    -1.3%

    Chicago SRW wheat ended December near its June reading; that endpoint does not show the absence of interim disruption or repricing.

The June baseline may already include expectations of an exit. The later monthly observations combine the exit with harvest news, export competition, and other developments. Chicago SRW futures do not measure all wheat grades or delivered Black Sea prices; no matched counterfactual is supplied.

Evidence and interpretation

The cited reporting describes anticipated disruption, Russian export competition, and subsequent alternative Ukrainian routes. Anticipation could shift repricing before the exit, while competing exports could ease supply pressure. This record does not quantify those channels. Ukraine’s corridor expansion by October also cannot, by itself, explain the June-to-September comparison.

How this record has changed

Living document — every material change is logged here, newest first.

  1. New evidence2026-10-31

    The corridor-revival track in this record moved from Kyiv's proposal to active US review. At the G20 foreign ministers' meeting in Atlanta on Oct 31, Secretary of State Marco Rubio said the United States is reviewing proposals from Turkey and India for a limited Black Sea ceasefire that would halt attacks on grain ships and, in some cases, energy shipments, and described growing international interest in such a partial deal. No agreement has been announced, and Russia has not accepted the plan.

    Reuters, 2026-10-31 (US, Canada see growing interest in limited ceasefire in Black Sea; Rubio reviewing Turkey and India proposals)

  2. New evidence2026-10-19

    The corridor-revival talks noted on Oct 12 now have a concrete BSGI-like shape, and a stated Russian veto. On Oct 18 President Zelenskyy said Turkey, Egypt and India have proposed safe navigation for vessels under their own flags entering both Ukrainian and Russian ports to carry food, with reciprocal commitments not to strike either vessel, but that Russia opposes the plan despite intermediary calls. In parallel, on Oct 17 Zelenskyy asked Poland, Romania, Slovakia and Hungary to again allow Ukrainian grain to transit their territory as at the start of the war; Hungary's prime minister said transit-only passage would face no obstacle from Hungary.

    Bloomberg via gCaptain, 2026-10-18 · EuropeSays (AFP), 2026-10-17

  3. New evidence2026-10-12

    Turkey and the UN have set up fresh talks with Russia and Ukraine on a Black Sea ceasefire aimed at protecting grain shipments, an attempt to replicate the 2022 corridor framework that this record documents. A closed-door kickoff took place on the sidelines of the UN General Assembly in late September with Turkey, the US, Europe, India and Egypt taking part, and early-October meetings were planned. Separately, Dragon Capital forecasts Ukraine could resume Black Sea grain exports in 2027 under a BSGI-like agreement, which it says could cut the blockade's GDP drag from 2.2 points to 0.7 points. Prospects remain uncertain: Russian Foreign Minister Lavrov has called a return to the 2022 deal unacceptable, and Ukraine's agriculture minister sees no positive signs of a deal in the coming months.

    Bloomberg via gCaptain, ~Oct 1, 2026 · UkrAgroConsult on Dragon Capital forecast, Oct 8, 2026

  4. Correction2026-09-25

    Revised the lesson and interpretation after commodity-trader feedback: price-window comparisons do not identify causal effects, and a declining price does not establish that a supply shock had no supportive effect. Removed unsupported claims about offsetting drivers and clarified benchmark and window limits.

    Commodity-trader feedback supplied by the user; editorial review of bundled event observations (25 Sep 2026) · CME Group — Wheat futures and options specifications

  5. New evidence2026-09-15

    Added two evidence lines: ERA5 weather reanalysis context for the event window (anomaly figures vs 1991-2020 baseline; weather data provided by Open-Meteo.com) and 'what the official numbers expected at the time' from USDA WASDE as-published vintages (expectations, not outcomes). Both from Morrowfly research vintage v1_2026-09-15; raw series stay in research.

    Morrowfly research vintage v1_2026-09-15 (ERA5 reanalysis via Open-Meteo; USDA WASDE as-published vintages)

  6. Correction2026-09-15

    An independent adversarial review cut unproven claims about how markets had positioned, replacing them with what was verifiable: a telegraphed exit, slowed inspections, and a record Russian crop. No new outcome data was added.

    Morrowfly internal adversarial review (15 Sep 2026)

Transmission

  • Wheat
    export restriction

    Ukrainian corridor revoked — but volumes had already shrunk for months as Russia slowed inspections, so the physical loss was smaller than the headline.

  • Corn
    export restriction

    Ukrainian corn had been the corridor's largest flow (17 Mt of 32.9 Mt shipped); by exit day buyers had pre-positioned alternatives.

Sources

Notes

  • Prices are monthly averages from our series (World Bank Pink Sheet; crude: EIA) unless noted; windows are labeled beside each number.
  • Generic futures series do not identify the delivery month at each observation or document the provider’s roll schedule and adjustment method. These price comparisons are not returns from holding one contract or following a specified roll strategy. Wheat comparisons also depend on protein, end use, and crop calendar.
  • Secondary press quotes are reported as published and were not individually audited against primary sources.
  • Illustrative scenario record. Not a prediction. Not financial advice.