Persistent cold dry weather affecting much of the US and Western Europe coupled with ongoing Chinese demand drove wheat and corn markets sharply higher this week. Chicago Board of Trade (CBOT) wheat futures have gained over 8% since last Friday’s close and are trading over $7 per bushel, bringing them to their highest level since May 2014. European new crop wheat futures have been equally impressive, setting new contract highs. London November 2021 wheat futures are now £26/t above their end of March low.

US winter wheat crop ratings were unchanged on the week with 53% rated ‘good’ to ‘excellent’ which is four points below last year. However, subsequent reports from Oklahoma of frost-damaged winter wheat helped galvanise speculative buying. Corn planting reached 8%, which is average for this time of year, but the cold US weather conditions are seen delaying crop establishment and yield potential, therefore adding more demand for depleted old crop supplies. Record low April temperatures coupled with a lack of rain is increasingly concerning for wheat crop production potential in Western Europe.

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