U.S. wheat prices surged by over 1% on Wednesday, driven by escalating tensions between Ukraine and Russia and concerns over dry weather in China, according to market analysts. The conflict in the Black Sea region, where Ukraine intensified attacks on Russian infrastructure, heightened global supply worries, prompting investors to buy back short positions (short-covering) in wheat futures. Meanwhile, reports of persistent drought in China’s wheat-growing regions—Shaanxi and Henan provinces—raised fears of reduced harvests, though analysts noted that China’s existing stockpiles may temper immediate import increases.
The Chicago Board of Trade (CBOT) July wheat contract WN25 closed at 5.43−1/4perbushel,a1.355.43−1/4perbushel,a1.354.38-3/4 per bushel and soybeans (SN25) at $10.45 per bushel. The weaker U.S. dollar (.DXY) contributed to the rally, as it made American grains more attractive to international buyers.
Analysts like Terry Linn of Linn and Associates emphasized that favorable weather in the Midwest, where planting is nearing completion, limited further gains in corn and soybeans. On the trade front, U.S. President Donald Trump’s upcoming talks with Chinese President Xi Jinping sparked optimism about resolving trade disputes, while Vietnamese firms signed agreements to purchase $2 billion in U.S. agricultural products, including wheat, as part of a broader trade deal.