First Futures Trading in Romanian Wheat and Bulgaria
The new futures contract that is completed in cash that has the potential to connect wheat from the intensive black sea area to export to the global market is a strong start, offering platforms to traders for risk management, arbitration opportunities with other regional markets and potential cross strategies.
Black Sea Wheat (CVB) settled financially (Argus) Futures will also allow effective wheat prices from one of the largest export areas in the world, especially from Romania and Bulgaria sent from the port of Constanța, Varna and Burgas (collectively known as CVB). Wheat from Romania and Bulgaria is sent to destinations around the world along with the black sea supply from Ukraine and Russia.
As many as 160,000 metric tons of wheat have been traded in the first month since it was launched in early June 2025, and the contract also began to trade more regularly. Many traders hope for contracts to become the leading international benchmarks for the Black Sea region. In addition, several trade bases cross the black sea and so on it is expected to be concluded with CVB Futures when the trade rate develops (see examples of hedge below).
CVB Wheat, a reliable benchmark for broader black sea trade
Prices and correlation of CVB wheat to other dark sea markets make it an effective price management tool for a wider area. Romania and Bulgaria have exported more than 56 million tons of wheat since 2020, according to the latest data from Eurostat. Romania and Bulgaria’s exports have reached around 13 million tons in the latest US marketing year 2024 – 2025 (June – May), according to data from the US Department of Agriculture (USDA). The export volume of the CVB port has increased 16% since 2022.
The price of Daily Argus CVB correlates well with the price of Daily Argus from the export of wheat from Russian Black Sea Harbor Novorossisk. Stability in the overall export level also helps make CVB prices a reliable price indicator for a wider black sea area. The Latest Argus Daily Price Collection published until June 2025 shows a high correlation between their free CVB prices on ships (FOB) and FOB Novorossisk at 0.97, showing that the price of CVB Argus wheat, which is the basis of the CVB future, can be easily used as a hedge instrument for cargo that comes out of Novorossisk. Usually, the value of more than 0.80 means the price is well correlated and that traders can use commodity prices to protect the fundamental price exposure to other markets.
Historical volatility in the black sea wheat market continues to increase in sustainable uncertainty
30 days of historical annual volatility, important statistical indicators that measure historical changes in underlying commodities, show that CVB wheat has been traded in the range of 15% -30% volatility since September 2023. The higher price volatility level usually leads to greater trade interest to manage risk of risks to improving.
Basic trading
Basis of trade, or purchase and or sales of commodities in certain cash markets with prices against recognized time prices, is a fundamental concept in the agricultural market.
More specifically, the base is negotiated as a premium or discount for the price of futures. The basis for calculating variables such as transportation, handling, storage, quality and currency, as well as local supply/demand factors. Discounts or negative bases are where physical prices are traded under futures, while the basis of premiums or positives traded on futures. The basic value can be determined by both parties when agreeing to trade or allowed to fluctuate from trading time to shipping physical wheat.
International millers who buy wheat from the Black Sea can use futures combined with agreed basis that is negotiated between the seller and the buyer to protect the price risk. The term and physical price are usually moving up and down together, allowing hedge for values to occur. With a trade base, only the price difference between physical and related time prices needs to be agreed between the buyer and the seller.
Buy Physical Delivery of Wheat from the Black Sea Using CVB Futures Plus agreed base allows buyers to trade CVB Futures to protect their local wheat prices either in the Black Sea area or to export export destinations
Protection uses the basis for buyers of international black sea wheat
Total exports from the Black Sea region, including Russia, Ukraine, Romania and Bulgaria, in the latest marketing year in 2024 – 2025 were almost 65 million tons. Egypt is the main importer of Black Sea wheat with a total volume of around 1.1 million metric tons from Romania, based on the latest data from the UN trading database.
Instead of buying wheat at a fixed price based on the cost of insurance transportation costs (CIF) sent to Egypt and takes the price of inherent prices, an Egyptian mill can buy Romanian wheat with the basis of the CVB futures market, thus protecting the value of adverse price movements at CIF prices.
For example, say on June 1, an Egyptian mill approaches wheat exporters to buy 50,000 metric tons (MT) to be sent by Egyptian CIF in September. Wheat exporters offer to supply Egypt Cif Wheat to Miller on a basis of $ 35 per MT on CVB Futures contract September, which is currently valued at $ 220 per MT.
Miller agreed to offer Futures + base.
Buying this way will allow Miller to lock in the price of futures (contributing about 85% of the purchase price), thus protecting the increase in the price of CVB wheat futures between July and September.
The 50,000 MT CIF Egypt Base Contract is confirmed by the exporter on $ 35 during September Black Sea Wheat (CVB) financially setting a futures price (Argus) ($ 220/MT when approved by the contract). On June 1, Miller fixed the full amount of the future, which was to buy 1,0001 September lots at $ 220 per mt. When they approached the September shipping window, Miller decided to improve the futures price element from the contract to fully give their basis contract price and carry out the exchange of Futures for Physical (EFP) .2 On August 30, Miller handed over to transfer a long 1,000-Lot position in September to exports to $ 265 per MT.
On September 1, Romanian exporters prepare to send 50,000 MT wheat to Egypt Miller with a contract agreed price of $ 265 (September EFP price) plus $ 35 (base) = $ 300 per MT CIF Egypt. Because the profit of $ 45 per MT made in a time account, the net cost paid is $ 255 per MT. If the Egyptian mill has been waiting to pay a fixed price for the September delivery at the end of August, it will pay an additional $ 45 per MT which reflects the amount with the price of CVB wheat futures has increased between July and September.
Protection Comparison with Flat Futures or Trading Prices
One of the main advantages for futures trading is to give companies the opportunity to improve the price of front wheat purchase before the planned delivery. This means the company can build strategic relations with their main suppliers who have set prices in the Futures Market.
By using the Black Sea Wheat (CVB) futures to protect the price risk, the company can focus on the quality of the product with a negotiated base before shipping. Volume can vary as needed and can be agreed in the short or long term. After the term wheat supply agreement is there, the milling is well placed to negotiate the basic agreement with the flour buyer that improves the volume of the contract over the specified time period. Traders are also placed well, knowing that they have a long -term purchase commitment from the factory.
The Black Sea Wheat Market remains an important source of supply for the global market and CVB wheat futures contracts can be used by a wider market to protect the cargo value supplied from the Black Sea. Prices correlated to other exports make it an effective hedge device and this can attract further clients to use them in their wheat trading portfolios.
There are several additional benefits for using Black Sea Wheat (CVB) which is completed financially (Argus) Futures registered by CME Group:
- CVB Futures is completed in cash.
- Products listed on the stock exchange and clearly provide safety and safety of the Central Counterparty clearing so as to eliminate the risk of partner.
- Protection Value is available for the next 15 months, allowing up to two years of plants to be protected and with prices using a base.
The CVB Futures market emerged as a new benchmark price for the Black Sea wheat market. Correlation of high prices with the origin of other black sea wheats such as novorissisk means that exports from all regions have the potential to be protected using CVB futures contracts. When the new harvest season takes place, a higher volume has the potential to be protected using CVB Futures, further strengthening the role of CVB Futures as the main benchmark for the Black Sea wheat market.
Source: CME Group
