Global wheat prices climbed to their highest level in two years on Thursday, with futures reaching $7.0850 per bushel before easing slightly to around $7.03 on the Chicago Mercantile Exchange.

The rally reflects growing concerns over global grain supplies, fueled by geopolitical tensions, adverse weather conditions in major producing countries, and rising production costs.

Why are wheat prices rising?

A combination of supply risks and production concerns has pushed global wheat prices higher.

One of the main drivers is the escalating conflict between Russia and Ukraine, two of the world's largest wheat exporters. Any disruption to exports from either country has a significant impact on global grain markets, commodity prices and food inflation expectations.

Russia's access to ports on the Sea of Azov and in the Caucasus has been restricted following Ukrainian attacks on port infrastructure, raising concerns over grain shipments through the Black Sea.

At the same time, Russia's wheat harvest forecast for the 2026/27 season has been revised downward due to declining yields and shrinking planting areas in the country's southern regions, adding to worries over future supplies.

How is the weather affecting wheat production?

Adverse weather conditions in several major wheat-producing regions have further tightened supply expectations.

In the United States, drought across key agricultural areas has reduced wheat planting to historically low levels, supporting higher prices.

In Europe, heat waves are expected to reduce France's soft wheat harvest, while Australia's crop outlook has also come under pressure as El Niño brings drier conditions and lower rainfall to one of the world's leading wheat-producing countries.

What role do fertilizer costs play?

Higher fertilizer costs have also contributed to the increase in wheat prices.

The ongoing US-Israel-Iran conflict has created logistical concerns over shipping through the Strait of Hormuz, a critical maritime route for global trade. These disruptions have increased concerns about fertilizer supplies and costs, raising production expenses for farmers.

How have prices moved?

Wheat futures rose to as much as $7.0850 per bushel on Thursday before settling near $7.03 on the Chicago Mercantile Exchange, marking the highest level in two years.

For comparison, wheat reached about $7.2 per bushel in May 2024, representing a 38% increase compared with levels recorded at the end of 2025.

What are analysts saying?

Dennis Voznesenski, an agricultural economist at Australia-based Commonwealth Bank, told Anadolu that disruptions to export capacity in the Black Sea have been a major factor behind the latest rally in wheat prices.

He said restrictions affecting Russia's export capacity in the Sea of Azov, combined with damage to Ukraine's key Black Sea ports, have increased concerns about global grain supplies.

Voznesenski added that fears over a potential closure of the Strait of Hormuz have compounded the effects of the Russia-Ukraine war by raising concerns over fertilizer availability.

He also warned that the current pressures could have longer-term consequences, potentially affecting wheat protein content, crop yields and cultivation areas worldwide.