Wheat Hits 12-month High

Wheat futures fell to below $5.7 per bushel, retreating from one-year highs seen February 27th as a record-breaking South American harvest and a surging US dollar neutralized recent geopolitical risk premiums. While the US-Iran conflict initially triggered a price spike, the market has recalibrated against an encroaching wall of physical supply. Argentina is offloading a record 27.7 million-ton harvest, while Australian production has been revised up following favorable rains. This influx of grain coincides with a 0.9% jump in the US Dollar Index, which has sharply reduced the competitiveness of US exports. Furthermore, a favorable early-March weather pattern is promising widespread precipitation across the US hard red winter wheat belt, paring earlier drought concerns. Despite robust cumulative exports running 18.8% ahead of last year, the combination of aggressive fund selling and the rollout of new 10% US global import tariffs has effectively capped the rally.

Wheat increased to 579.50 USd/Bu, the highest since February 2025. Over the past 4 weeks, Wheat gained 8.08%, and in the last 12 months, it increased 7.88%.

Wheat futures pulled back to below $5.7 per bushel after reaching the highest in 8 months on February 20th as the market recalibrated against an encroaching wall of physical supply and shifting macroeconomic hurdles. The initial risk premium, built on Black Sea frost threats and US Plains drought, is dissolving as weather models now forecast favorable precipitation for the hard red winter wheat belt, paring earlier crop-loss fears. Simultaneously, the global supply balance is shifting toward abundance following India’s release of a 2.5 million-ton export quota, Argentina’s record 28 million-ton harvest, and upgraded Russian production forecasts climbing toward 91 million metric tons. This influx of grain enters a market increasingly concerned by the US administration's 15% global tariff announcement, which threatens to trigger retaliatory trade barriers. Consequently, despite robust weekly export inspections running 19% ahead of last year, futures failed to hold onto multi-month highs.