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Cheaper wheat raises hope for global food prices

STORY: There was hope Monday (May 22) for cheaper food prices ahead.

Wheat futures traded in Chicago fell below $6 per bushel, the unit used, for the first time in two years.

They’ve been dropping on bets that ample global supplies will easily meet demand.

Last week also saw a deal to extend Ukraine’s grain exports through the Black Sea.

Russia had threatened to let the agreement expire, unless there were steps to facilitate its own shipments.

But, in the end, the pact was extended for another two months.

A commodities analyst told Reuters that should see Ukrainian grain flowing onto world markets at a time when cheap wheat from Russia and elsewhere was already available.

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Exports from the EU are also expected to hit record volumes.

It’s shipping increasing quantities to the U.S.

Other key agricultural commodities including soybeans and corn are also seeing price falls.

That could spell relief for global consumers pressed by food price inflation.

Last week saw euro zone inflation accelerate to 7%, though there were signs that food price rises were easing off.