Full Breakdown
Global Crop Prices Reach Two-Year High as Middle East Conflict and Drought Tighten Supplies
4/30/2026, 12:15:17 AM
Surge in Crop Prices Amid War and Weather
The Bloomberg Agriculture Spot Index, which tracks ten of the world’s top-selling crops, rose for a third consecutive month to its highest level since November 2023. Benchmark wheat futures on the Chicago Board of Trade have risen 11-12 % since the war in Iran began in late February, reaching the strongest price since mid-2022. Corn futures climbed 6 % over the past two months, hitting a one-year high. In the United States, soybean oil prices surged roughly 50 % this year, while palm oil advanced 12-13 % as major producers in Indonesia, Malaysia and Thailand increase biofuel use.
War in the Middle East and Drought Amplify Risks
The prolonged closure of the Strait of Hormuz has lifted crude oil, fertilizer and freight costs, reshaping global commodity balances. Simultaneously, persistent dryness across the U.S. Great Plains, severe weather outlooks for Australia and Russia, and an emerging El Niño pattern add a “second major layer of risk,” according to StoneX broker Kang Wei Cheang. The combined effect tightens supply for fertilizer-intensive crops such as wheat and corn and raises the baseline for food prices worldwide.
Price Movements and Crop Ratings
U.S. wheat futures for soft red winter wheat climbed as much as 4.1 %, the highest since June 2024. The USDA left its overall crop rating unchanged at 30 % “good or excellent,” but the share of wheat rated “poor or very poor” increased, reflecting drought-related stress on 68 % of the hard-red winter wheat crop. AgWeb’s Michelle Rook notes the hard-red winter wheat harvest ranks as the fifth-worst in U.S. history.
Analysts and Industry Leaders Weigh In
- Kang Wei Cheang, agricultural broker, StoneX (Singapore): highlighted the dual impact of war-driven logistics costs and weather.
- Oscar Tjakra, senior analyst, Rabobank (Singapore): warned the conflict could add several percentage points to global food inflation over the next 6-18 months.
- Greg Heckman, CEO, Bunge Global SA: reported a slight shift among U.S. farmers toward soy over corn and noted Bunge’s raised profit outlook on stronger biofuel demand.
- Yuriy Ruban, analyst, Agriculture and Horticulture Development Board (UK): observed French corn planting is curbing output as fuel and fertilizer prices soar.
Official Assessments from Agencies and Companies
The USDA’s unchanged rating underscores persistent drought concerns while acknowledging pockets of better-performing soft-red and white wheat. Bunge’s profit guidance reflects higher biofuel mandates and the war’s inflationary pressure on oilseeds.
Farmers Voice Concerns Over Planting and Yields
Kansas wheat producer Justin Gilpin, CEO of Kansas Wheat, described a “substantial deterioration” of the state’s crop, attributing poor yields to insufficient rainfall despite early optimism. Across the Plains, growers are cutting back planting of nutrient-intensive grains to manage soaring fertilizer and fuel costs.
Discrepancies in Reported Increases and Ratings
Sources differ on wheat-futures gains—Raghu and Gu cite an 11 % rise, while Bloomberg’s later report records a 12 % increase. USDA crop-rating figures also vary, with one source noting a “good or excellent” share of 30 % and another emphasizing a “below 15 %” rating for hard-red winter wheat in the Southern Plains.
Verbatim Quotes
- “Weather is now emerging as a second major layer of risk,” — Kang Wei Cheang, agricultural broker, StoneX
- “The war has changed that balance materially, primarily through energy, fertilizer, and logistics channels,” — Kang Wei Cheang
- “If the conflict persists, it could add several percentage points to food inflation over the next six to 18 months.” — Oscar Tjakra, senior analyst, Rabobank
- “‘We had a lot of optimism when this crop went in the ground in the fall,’ Gilpin says.” — Justin Gilpin, CEO, Kansas Wheat
- “The war is inflationary for food, mainly through energy, fertilizer, and shipping disruptions, with effects that are broad, global, and lagged,” — Oscar Tjakra
Outlook for Food Prices and Planting Decisions
Analysts expect El Niño-related heat stress to influence planting choices for palm oil, soybeans and corn later in 2026. Continued high energy and freight costs may keep a “higher floor” under commodity prices, extending elevated food-price pressures for consumers worldwide.
