Wheat futures closed at 784 cents per bushel, marking a 3.1% increase and a 12.1% rise for the week, the largest weekly gain since March 2022. Year-to-date, wheat prices have surged over 54.5%, primarily due to escalating tensions between Russia and Ukraine, which have disrupted grain exports from the Black Sea, a critical region for global wheat supply.
In contrast, corn futures settled at 536.5 cents per bushel, up 0.6% on Friday and 5.5% for the week, with a year-to-date increase of 21.8%. The corn rally is attributed to tighter U.S. supply expectations and strong demand, compounded by reduced yield forecasts from the USDA, which lowered its estimate by 2.3 bushels per acre to 180.7.
Concerns about the U.S. crop have intensified due to adverse weather conditions, including excessive rainfall and fungal diseases, which have negatively impacted yields. Additionally, the USDA raised corn export projections by 75 million bushels to 3.3 billion, reflecting increased global demand amid constrained Ukrainian exports.
The situation is further complicated by drought conditions in Europe, which may lead to increased domestic wheat usage for animal feed, thereby tightening wheat supplies. Overall, the combination of supply disruptions and heightened demand is driving prices higher, attracting both fundamental and systematic traders to the market