KANSAS CITY — The Russian declaration of a ban on grain exports that takes effect on Aug. 15 and extends at least through the end of the year jolted U.S. and world wheat markets pushing wheat futures prices in Chicago, Kansas City and Minneapolis near or even above $8 a bu for the first time in two years. Profit-taking on Friday, Aug. 6 pared the week’s price gains, but the advance extended a rally in wheat futures that began in mid-June.

Russian Prime Minister Vladimir Putin announced the ban saying, “I think it advisable to introduce a temporary ban on the export from Russia of grain and other agricultural products made from grain.”

The ban was not unexpected. For several days there were rumors Russia would embargo grain sales as it became clearer the most severe drought in decades was exacting a heavy toll on the nation’s grain production.

The International Grains Council on July 29 forecast Russian wheat production this year at 50 million tonnes, down 7 million tonnes from its June projection and compared with the U.S. Department of Agriculture’s July projection at 53 million tonnes and the 2009 Russian outturn of 61.7 million tonnes. The private U.S. and world crop analyst Informa Economics on Aug. 5 estimated the 2010 Russian crop at 49 million tonnes. The U.S. Department of Agriculture will issue revised world wheat supply-and-demand estimates on Aug. 12, which will include adjusted numbers for Russia and other drought-afflicted nations including Kazakhstan and Ukraine.

The Russian grain export ban drew into question the fate of export contracts entered into by Russian exporters and foreign buyers. Exporters sought to load out as much wheat as possible before the Aug. 15 deadline. Indications were some contracts already were being canceled.

Regardless of the disposition of individual existing contracts, the Russian export ban was expected to shift additional foreign wheat demand to the United States. The U.S.D.A. on July 9 forecast U.S. wheat exports in 2010-11 at 1 billion bus. The trade anticipated the Russian action may increase U.S. wheat exports by 150 million to 200 million bus.

U.S. Trade Representative Ron Kirk in an interview with CNBC said, “Obviously, there’s an opportunity for us to help fill the gap with Russia in the case of wheat and China with respect to corn. Whether we know it’s a long-term opportunity or just one of filling a temporary gap, it still is good news for America’s farm and agricultural interests.”

In a brief published on Aug. 6, Dirk Jan Kennes, the director of commodities for the international market research firm Rabobank, Utrecht, The Netherlands, said wheat prices will remain high for the next 10 years.

“On the surface this situation feels like the food crisis of 2007 and 2008,” Mr. Kennes said. “Poor harvests are once again driving the price-spike. But global stock levels are much higher right now than at that time. So this time around we should be able to cope better with the production declines.”

But, Mr. Kennes noted, for the first time since the 2008 food crisis the world is producing less wheat than is consumed. Growing populations and rising prosperity are causing the growth in demand. Changing consumption patterns in countries like China and India mean more people are eating wheat-based products. And as people become more prosperous, they start to eat more meat.

“Not everyone makes the connection between meat and wheat,” Mr. Kennes said. “But grains are essential elements of animal feeds. For every kilogram of chicken you buy in the shop, you need two kilograms of animal feed.

He added that although stock levels are currently high, the world does need to deal with lower average stocks.

“Tighter grain markets on the one hand and a more liberal E.U. agricultural policy on the other will leave less room to buffer potential production shortages,” he said. “So prices will fluctuate much more. Stocks are now around the same levels as just before the food crisis of 2007. But if you adjust the figures for India and China, global stocks are lower.”