Wheat prices surge as Russia halts exports

RUSSIA’S decision to ban wheat exports for the rest of the year sent prices for the grain soaring yesterday to their highest level in two years.

Russia, one of the world’s biggest grain exporters, said yesterday that it was cutting off wheat exports from 15 August to 31 December because a severe drought this summer has already destroyed one-fifth of the country’s crop. It will also ban exports of wheat flour, barley, rye and corn. Prime Minister Vladimir Putin said whether the ban was extended into 2011 would be decided after the harvest.

Wheat prices have risen more than 80 per cent since early June and notched their biggest monthly gain in July in at least 51 years. Prices for September delivery shot up 60 cents, or 8.3 per cent, to $7.8575 a bushel yesterday, the maximum one-day jump allowed.