Wheat prices rise as late frost adds to tests facing US crop
• Fears rise for renewal of Iran conflict, lifting Brent crude above $95/Bbl
• Tehran threatens retaliation for US Navy seizure of Iran cargo ship
• Wheat supported too by US weather concerns
• Late frost adds to tests for Plains hard red winter wheat
For in-depth market analysis, see CRM’s Weekly Grains Outlook published earlier on Monday.
Wheat futures made a firm start to the week, buoyed by mounting concerns over weather setbacks to the US winter crop, as well as fears for a resumption of hostilities in Iran which lifted broader grain markets.
Soft red winter wheat futures for July-26 gained 1.5% in late morning deals in Chicago, to bounce back above $6.00/Bu.
The headway reflected in part concerns over a re-escalation in Middle East tensions, after the US’s seizure of an Iranian vessel in the Gulf of Oman enhanced doubts for an extension of the US-Iran ceasefire, which ends on Wednesday.
Iran said it had not yet decided whether to attend a second round of peace talks in Pakistan, and vowed retaliation for the seizure of the Tousca cargo ship by the US Navy, terming the move an “act of armed piracy”.
With shipping through the Strait of Hormuz near a standstill again, hampering exports of Middle East oil, gas and fertiliser, Brent crude futures for June-26 gained 5.3% in late trading to return above $95/Bbl.
Wheat also gained support from concerns for the US winter wheat crop, enhanced by a dry weekend for much of the Plains, where drought is provoking yield worries, and a cold one too. Saturday night temperatures fell to minus 4 Celsius (25 Fahrenheit) and below in parts of Colorado, Nebraska, and Kansas, the top growing state, where wheat is starting to head.
July-26 futures in hard red winter wheat, as grown in the Plains, topped $6.60/Bu earlier for only the second time for a best-traded contract since June 2024, before falling back on profit-taking ahead of the USDA’s latest weekly crop rating, due later on Monday.
Minneapolis spring wheat for July-26, which is being buoyed by a weak USDA US sowings forecast as released on 31 March, neared $6.80/Bu for the first time since June 2024 for a best-traded lot.
In Europe, Paris milling wheat for September-26 added 1.1% in late trading to return above its 50-day moving average, while London feed wheat for November-26 gained 0.8%, also helped by data showing UK wheat imports in February at 165.8Kt, the lowest since August 2023.
Oilseeds gained ground too from the rise in oil prices, which supports values of vegetable oils, such as rapeoil, used largely in making biodiesel.
Paris rapeseed for August-26 rose by 0.8% in late deals, back above €490/t.
