Wheat Highest Since 2024 as Drought, Fertilizer Costs Hit Supply

Wheat surged to the highest level in nearly two years as US drought conditions pressured yields and raised supply concerns. Soaring fertilizer costs are also prompting farmers to reduce plantings of nutrient-intensive crops such as grains, adding further support to grain prices. The setup is constructive for agricultural commodities, with potential spillover into food inflation.

Analysis

Wheat surged to the highest level in nearly two years as US drought conditions pressured yields and raised supply concerns. Soaring fertilizer costs are also prompting farmers to reduce plantings of nutrient-intensive crops such as grains, adding further support to grain prices. The setup is constructive for agricultural commodities, with potential spillover into food inflation.