Wheat Jumps 4%, Hits Four-Month High Amid Cold Weather in U.S.
Freezing temperatures in key winter wheat regions of Russia and the United States could damage dormant crops, which are losing their protective snow cover. Moscow, the world’s largest wheat exporter, faces potential supply risks.
Chicago Board of Trade (CBOT) wheat futures hit their highest level since October on Friday, as cold weather in the Black Sea region and U.S. plains supported prices and triggered short-covering, analysts said.
Weaker Dollar
Grain and soybean futures also found support from a weaker U.S. dollar and investor relief that President Donald Trump did not immediately impose reciprocal tariffs, according to analysts.
Trump’s decision to direct his economic team to draft tariff plans was interpreted as leaving room for negotiations. However, traders remained cautious about a potential trade war and possible retaliatory measures against U.S. agricultural exports.
The most active wheat contract in Chicago rose 4% to $221 per ton. Corn futures gained 0.6% to $195.37, while CBOT soybeans climbed 0.5% to $380.47.
Meanwhile, in France, the soft wheat crop has significantly deteriorated since December, according to data from FranceAgriMer.
Concerns over supply have prompted commodity funds, which hold a large net short position in wheat, to start covering their positions.
Agricultural Commodities Impact on Inflation
The surge in wheat, corn, and soybean prices reflects a broader trend of rising commodity prices, excluding oil, driven by supply concerns, adverse weather conditions, and market speculation. As key staples in global food production, these grains play a critical role in inflationary pressures, impacting everything from livestock feed costs to consumer food prices.
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