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(Bloomberg) -- Wheat was set for its biggest weekly gain in almost two months, as persistent weather concerns and tighter fertilizer supplies linked to the Iran war stoked worries over the crop’s supply outlook.

The most active wheat contracts on the Chicago Board of Trade were on track to climb nearly 5% on the week, their biggest such jump since February. The hard red winter variety extended gains to hit its highest level since June 2024. 

Drought conditions were expected to linger in key areas of the US Great Plains, while in Australia, a shortage of farm inputs and persistent dryness weighed on wheat acreage in the major producer and exporter. 

Dry weather also continued in parts of the Black Sea growing region and some areas of Europe, impacting wheat supply outlook in some of the world’s top producing regions, according to the latest forecasts from Vaisala XWeather. 

“Much of the gain has been driven by sustained dry conditions in western HRW wheat regions,” said Tobin Gorey, a strategist at Cornucopia Agri Analytics, referring to the hard red winter grain. Fertilizer supply worries, especially for southern winter crops like in Australia, and an impending El Nino have also helped boost prices, he added. 

The bullish run could have limits given ample global supplies, Gorey said. Still, any potential crop issues in Australia and Argentina could provide a catalyst for more price gains later, he added.

Planting acreage for the 2026/27 wheat crop in Australia is expected to fall to a seven-year low, according to a Bloomberg survey, as weak prices and fertilizer and fuel shortages weigh on harvest prospects.

US President Donald Trump said America and Iran could clinch a permanent ceasefire, striking a positive tone for a possible end to the conflict now nearing the end of its seventh week. However, the Strait of Hormuz remains largely closed, prolonging an energy and fertilizer crisis and threatening production of key crops worldwide. 

Palm oil futures traded on Bursa Malaysia Derivatives were down, as weak demand from India and a closed Middle East market continues to weigh on prices.

More stories like this are available on bloomberg.com

©2026 Bloomberg L.P.

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