Wheat Prices Head for Biggest Weekly Increase in Two Months

(MENAFN) Wheat prices are on course for their sharpest weekly rally in two months, as the widening conflict in the Middle East stokes mounting fears over food inflation and the fragility of global agricultural supply chains.

Chicago benchmark wheat futures have surged approximately 4.5% this week, propelled by a potent mix of geopolitical instability and deteriorating weather across key growing regions, including the US.

A newly released report by aid organization Mercy Corps paints a stark picture, warning that the economic shockwaves from the conflict have already "locked in" food insecurity outcomes for 2026 and 2027 across some of the world's most vulnerable nations. Mercy Corps flagged that cascading disruptions to fuel, fertilizer, and shipping networks are rapidly bleeding into import-reliant economies — including Somalia, Ethiopia, and Pakistan — striking critical planting seasons currently underway.

The report highlights that global fertilizer prices spiked during a pivotal window for farmers, while fuel costs in certain markets exploded by as much as 150% within days, driving up transport and irrigation expenses. Meanwhile, commercial shipping through the Strait of Hormuz — a linchpin corridor for global energy and trade flows — has collapsed by more than 90%, severely choking agricultural supply chains.

Humanitarian fallout is already materializing on the ground. In Somalia, fuel price shocks have doubled water costs in drought-stricken areas. Aid deliveries to Sudan, rerouted around southern Africa, now face additional thousands of miles and weeks in transit delays.

The World Food Programme estimates the crisis could push an additional 45 million people into acute hunger worldwide.

Analysts caution the damage to food production may outlast the conflict itself. Mercy Corps cited Food and Agriculture Organization data indicating that supply disruptions exceeding 40 days can fundamentally shift farmer behavior — triggering reductions in fertilizer application and planted acreage, with consequences that ripple into future harvests.

"The food security consequences of this war are already written into harvests that have not yet been planted," said Melaku Yirga, Mercy Corps vice president for Africa.

"Even if prices were to stabilize tomorrow, the most important agricultural decisions have already been made. Farmers are already planting less, or not at all, because they can't afford the inputs," he added.

Drought conditions are compounding the crisis further. More than half of the US is currently gripped by drought, with arid conditions also battering wheat-growing belts in Australia and the Black Sea region, tightening the global supply outlook still further.

The convergence of conflict, climate stress, and surging input costs is intensifying analyst warnings that food prices will continue their upward trajectory — with the steepest toll falling on nations already teetering on the edge of severe food insecurity.

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