Wheat futures climbed more than 1% to above $7 per bushel in late July, reaching their highest level since July 2023, as worsening geopolitical tensions and adverse weather conditions fueled supply concerns. President Trump warned that the US would hold Iran accountable for any further Houthi attacks after Yemen's Houthis said they had targeted two Saudi oil tankers for allegedly breaching their maritime blockade. The attacks, the first since the Iran-backed group announced a naval blockade against Saudi Arabia, heightened fears of broader disruptions to global energy and shipping routes. Adding support to wheat prices, intense heat weakened crop prospects in France and Germany. Moreover, EU grain output is forecast to decline by more than 9% this year, marking the sharpest annual contraction in more than two decades. Elsewhere, extreme temperatures across North Dakota, a key US spring wheat-producing state, have increased stress on crops and raised concerns over yield losses.

Wheat futures climbed to around $7.0 per bushel in late July, returning to their highest level since May 20, 2024, as worsening Black Sea tensions and deteriorating crop prospects fueled supply concerns. Russia restricted access to certain Sea of Azov and Kavkaz ports while continuing strikes on Ukrainian port infrastructure, as Ukraine launched drone attacks on warehouses operated by Wildberries. The escalating tensions heightened concerns over grain shipments through the Black Sea, a critical export corridor for two of the world's largest wheat exporters. Further supporting prices, SovEcon reduced its forecast for Russia's 2026/27 wheat harvest by 0.7%, citing lower yield expectations in southern regions and reduced spring wheat acreage. Elsewhere, France's soft wheat production is expected to drop 7.6% this year following heat-wave damage, while US spring wheat conditions deteriorated, with the good-to-excellent rating falling five percentage points from a week earlier.

Wheat futures slipped to around $6.70 per bushel in mid-July, retreating from a more than two-year high reached on July 15 as traders locked in profits. Despite the pullback, prices remained elevated as the Russia-Ukraine conflict showed no signs of easing, with Russian forces resuming strikes on Ukrainian port infrastructure along the Black Sea coast in response to recent Ukrainian attacks on Russian vessels in the Sea of Azov and the Black Sea. Adding pressure on prices, the USDA reported US wheat net export sales of 235,100 metric tons for the week ended July 9, below market expectations. Meanwhile, supply concerns emerged after the Grain Industry Association of Western Australia projected the state’s 2026 wheat harvest at 9.5 million tons, down nearly 30% from 13.3 million tons in 2025 due to hotter and drier conditions. Australia, one of the world’s largest wheat exporters, supplies key markets across Southeast Asia, the Middle East, and China.