Middle East conflict keeps wheat markets elevated

Global grain markets remain volatile with heightened tensions in the Middle East adding support to prices, despite large supplies globally.

Unlike the disruption at the start of the Ukraine war, grain trade flows have continued largely uninterrupted with most countries still able to access supplies and production not significantly impacted.

However, surging oil prices and concerns over fuel and fertiliser availability have had an impact on wheat markets and kept prices elevated, especially for new crop.

See also: Grain markets volatile as Iran conflict pushes up costs

UK feed wheat futures for the November contract reached a seven-month high of £185.50/t on 9 March, before settling back to £180/t on 18 March.

Analysts at grain marketing platform Hectare Trading said: “Many farmers are starting to price a portion of their 2026 crop, hoping to capture short-term price spikes in an otherwise oversupplied market.”

Several merchants have advised growers to sell a portion of grain forward in order to secure a margin and help ease cashflow concerns related to rising farm inputs.

Traders at Frontier Agriculture suggest that grain prices will continue to be influenced by volatile energy markets, with the future looking very uncertain given the ongoing conflict and attacks on oil facilities and shipping vessels.

Beyond geopolitical pressures, global grain markets remain well supplied with high global stocks.

European trade association Coceral has increased its estimate for the total grain crop in the EU-27+UK by 2.1m tonnes to 298.8m tonnes.

Russian wheat exports are expected to increase, with market analysis firm SovEcon estimating exports at 3.8m tonnes in March, compared with a five-year average of 3.1m tonnes.

Andrey Sizov, managing director of SovEcon, said: “The competitiveness of Russian wheat is improving.

“In recent weeks, margins for Russian wheat exports have turned positive, while at the start of the year they were close to zero or negative.

“At the same time, wheat shipments from Russia’s main competitors have declined.”