Chicago: Global wheat prices surged to $7.0850 per bushel on Thursday, marking their highest level in two years. The broader grain market has been driven higher by geopolitical risks, weather concerns in the US, and escalating tensions between Russia and Ukraine. Supply and production disruption expectations are driving the surge in wheat markets.
According to Anadolu Agency, Russia's access restrictions at its ports on the Sea of Azov and in the Caucasus due to Ukraine's attacks on port infrastructure threaten grain flows through the Black Sea. Russia's wheat harvest forecast for the 2026/27 season has been downwardly revised due to declining yields and shrinking planting areas in the southern regions. As two of the world's largest grain exporters, disruptions in Russia and Ukraine's exports significantly influence commodity prices and food inflation expectations.
Drought in key US agricultural regions has reduced wheat planting areas to historic lows, contributing to the rise in prices. Additionally, the increase in fertilizer costs amid the US-Israel-Iran war due to logistical issues in the Strait of Hormuz has further impacted wheat prices. In France, the soft wheat harvest is expected to decline due to European heat waves, while El Nino is leading to a drier climate with less rainfall in Australia, fueling concerns over the harvest as the country is one of the major wheat producers.
Wheat prices surged as high as $7.0850 per bushel on Thursday before settling around $7.03 on the Chicago Mercantile Exchange. In May 2024, wheat rose as high as $7.2 per bushel, up 38% compared to the end of 2025. Dennis Voznesenski, an agricultural economist at Australia-based Commonwealth Bank, told Anadolu that disruptions to export capacity in the Black Sea drove the surge in global wheat prices, especially with Russia's export capacity in the Sea of Azov restricted and Ukraine's main Black Sea ports damaged. He noted that risks related to the potential closing of the Strait of Hormuz have worsened the impact already caused by the Russia-Ukraine war, leading to concerns over fertilizer supplies. He added that wheat's protein content, yield, and cultivation areas could also be potentially impacted on a global scale in the future.