Wheat futures rose more than 1% to above $7 per bushel in late July, reaching their highest level since July 2023, as escalating geopolitical tensions and unfavorable weather stoked concerns about global supply. President Trump warned that the United States would hold Iran responsible for any further Houthi attacks after Yemen’s Houthi movement claimed it had targeted two Saudi oil tankers for allegedly violating its maritime blockade. These strikes, the first since the Iran-backed group declared a naval blockade against Saudi Arabia, intensified fears of wider disruptions to global energy supplies and key shipping lanes.
Weather-related risks further bolstered wheat prices. Intense heat has damaged crop prospects in France and Germany, while EU grain production is projected to fall by more than 9% this year, the steepest annual decline in over two decades. In the United States, extreme temperatures in North Dakota, a major spring wheat-producing state, have increased stress on crops and raised concerns about potential yield losses.
