CHICAGO - U.S. wheat futures tumbled on Friday to levels not seen since Russia's invasion of Ukraine in February disrupted flows from the Black Sea breadbasket region, pressured by a firmer U.S. dollar and rising global supplies from the northern hemisphere's harvest.
Soybeans and corn retreated in tandem with wheat in risk-off trading ahead of the long U.S. Independence Day holiday weekend and worries about tepid demand and the broader economy.
High inflation and a rush by central banks to raise rates and stem the flow of cheap money has fueled sell-offs across markets, pressuring grains prices that had spiked to near record peaks following Russia's invasion.
"The outside markets are certainly a factor, especially if you're talking about a Federal Reserve policy shift and a dollar that's exploding higher," said Mike Zuzolo, president of Global Commodity Analytics.
Benchmark Chicago wheat futures have fallen nearly 40% from a peak in March as some grain shipments have begun to flow from Ukraine and as accelerating winter wheat harvests across the northern hemisphere bolster supplies.
"When the Ukraine issues started happening, we had to aggressively price-ration the old crop. ... Now that all this new-crop harvest is coming to market, we don't have to price ration so aggressively," said Craig Turner, senior ag broker at Daniels Trading.
CBOT September wheat fell 38 cents to $8.46 a bushel, the lowest since late February and down 9.7% in the week.
New-crop November soybeans touched their lowest since Feb. 4 and ended down 62-3/4 cents at $13.95-1/4 a bushel. CBOT December corn shed 12-1/4 cents to $6.07-1/2 a bushel, down 9.9% for the week and a four-month low.
After initially rising following Thursday's U.S. Agriculture Department acreage report, traders are waiting to see if soybean planting drop would be amended.
They are also monitoring rain forecasts next week for drought-parched areas of the Midwest.
(Reporting by Karl Plume in Chicago; Editing by David Gregorio and Will Dunham)