Corn and wheat prices have surged to their highest levels in more than three years. Corn prices are mainly driven by tighter U.S. supply expectations, while wheat prices are more directly tied to Black Sea export disruptions.
Global supply constraints, weather, and strong demand are adding further pressure to both markets.
Corn futures settled 0.6% higher at 536.5 cents per bushel on Friday, while wheat futures settled 3.1% higher at 784 cents per bushel.
The recent rally in corn prices is largely driven by mounting concerns around U.S. crop supply, while wheat prices are rising due to escalating tensions between Russia and Ukraine in the Black Sea.
A recent report by the U.S. Department of Agriculture indicated that corn yield estimates were lowered, adding to market anxiety.
Weather conditions in Europe, including drought, have also impacted wheat production.
Disruption of wheat supply
Wheat's price increase, unlike corn, is tied to disruptions in global supply.
Russia and Ukraine together account for more than a quarter of global wheat exports, and supply disruptions in the region have significantly affected price increases.
The rise in corn and wheat prices, along with supply issues, may trigger new buying in the market.
