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GRAINS-U.S. futures in cautious range as Ukraine war escalation looms

(Updates prices, adds details and analyst comment)

By Enrico Dela Cruz

Sept 22 (Reuters) - U.S. wheat, soybean and corn futures flitted between losses and gains in a narrow Asian trading range on Thursday, as traders digested concerns about Black Sea supplies and worries over a possible global recession dampening demand for commodities.

The most-traded wheat contract on the Chicago Board of Trade (CBOT) was up 0.1% at $9.04-1/4 a bushel, as of 0229 GMT.

CBOT corn gained 0.1% to $6.86 a bushel, while CBOT soybean climbed 0.3% to $14.65-3/4 a bushel.

Fears of an escalation in the Ukraine war, which has disrupted crucial grain exports from the Black Sea region, supported prices, analysts said.

Russian President Vladimir Putin has ordered first wartime mobilisation since World War Two and announced moves to annex four Ukrainian provinces, while threatening to use nuclear weapons to defend his country.

Western countries described Moscow's move as an act of desperation in the face of a losing war.

Ukraine President Volodymyr Zelenskiy demanded a special United Nations tribunal impose "just punishment" on Russia for its invasion of Ukraine, including financial penalties and stripping Moscow of its veto power in the Security Council.

Ukraine's grain exports, which have slumped since the start of the war in February, are down 43.2% year-on-year in the 2022/23 season so far at 6.88 million tonnes, the agriculture ministry said.

But concerns about demand and a strong dollar hounded grains markets at the same time, after the U.S. Federal Reserve signalled more aggressive interest rate hikes this year.

Fed Chair Jerome Powell vowed on Wednesday that he and his fellow policymakers would "keep at" their battle to beat down inflation, as the U.S. central bank hiked rates by 75 basis points for a third straight time, as expected.

"The Fed is effectively acknowledging that a recession is coming, but inflation will not fall quickly and there will be a lot of pain," ING economists said in a note.

Adding to supply concerns, Argentina's Rosario grains exchange cut its production forecasts for the country's corn and wheat crops as a prolonged drought impacts the major grains-producing country. (Reporting by Enrico Dela Cruz in Manila; Editing by Sherry Jacob-Phillips)

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