Plains wheat prices near two-year high, as US dryness jitters mount
• Lebanon-Israel reportedly agree ceasefire, but Iran-US talks scaled back
• Brent crude returns close to $100/Bbl
• US hard red winter wheat leads buoyant wheat market
• US Plains rains fail to improve growing conditions
For in-depth market analysis, see CRM’s monthly wheat and corn market outlook reports, as published earlier on Thursday.
Wheat futures outperformed, as a drier Plains weather forecast stoked concerns for the US winter crop, adding to support from a resurgent crude oil market.
Brent crude futures for June-26 added 3.9% in late deals to return within $1.50/Bbl of the much-watched $100/Bbl mark, supported by concerns of lingering disruptions to Middle East exports.
Although Israel and Lebanon agreed a ceasefire, according to Donald Trump, Iran and US negotiators have reportedly scaled back ambitions for a peace deal, seeking instead a temporary memorandum to prevent a re-escalation of hostilities.
The reports were viewed as lowering the chances of a return to open shipping through the Strait of Hormuz, which continues to witness only a fraction of the vessel numbers seen before the Iran war.
Other energy commodities rose too, as did ags used in making biofuels. Soyoil futures for May-26 added 2.8% to return close to $0.70/lb in Chicago. In Paris, August-26 rapeseed headed for the close up 1.4%, rising back above €500/t.
Wheat futures gained extra support after weather model runs reduced the amount of rain expected in the Plains over the rest of this month, enhancing concerns for dryness damage to the US winter wheat crop.
Separately, weekly USDA data showed the proportion of winter wheat growing in drought areas holding at 68%, dashing hopes that rains received in the south eastern Plains had eased dryness.
Futures in hard red winter wheat, as grown in the Plains, soared 3.0% for May-26 delivery, to hit the highest for a spot contract since June 2024. The better-traded July-26 contract posted 2.8% headway in midday deals.
Chicago soft red winter wheat, the global benchmark, which is grown in the Midwest, was helped up 1.2% for May-26 futures to return above $6.00/Bu, with the July-26 lot adding 1.1%.
US wheat export sales last week of 100.3Kt of old crop, and 131.0Kt for 2026/27, came within the range of market forecasts.
In Europe, Paris milling wheat for September-26 added 0.7%, while the London November-26 feed wheat contract settled up 1.3%, at its 20-day moving average.
Chicago soybean futures for July-26 posted 0.1% headway, balancing support from soyoil against pressure from data late on Wednesday showing the US March crush at 226.2Mbu. Although up 16.3% year on year, the figure fell short of market expectations of a 230.0Mbu number.
Earlier on Thursday, the USDA reported US soybeans export sales last week of 248Kt, towards the lower end of market expectations.
Corn futures for July-26 slipped by 0.4%, amid a drier outlook for the US Midwest, where wetness has been sparking some concern of a slowdown in sowings. US corn export sales last week hit 1.4Mt, in line with market forecasts.
