Spring wheat futures topped US$8 per bushel July 3, reaching levels not seen since 2013.
The Minneapolis September contract has gained more than $2.50 per bu. in about six weeks.
A bullish U.S. Department of Agriculture acreage report, released June 30, pushed futures prices for spring wheat and most crops higher. However, the real driver is drought in the northern U.S. Plains, where most spring wheat is grown, said Greg Kostal, commodity market analyst and owner of Kostal Ag Consulting in Winnipeg.
“Hands down, if the USDA report didn’t come out, the market would have went higher anyway because of the perception of weather,” he said. “There’s a pretty dominant, blocking drought pattern in the western half of North Dakota, eastern half of Montana. And it’s expected to persist the next two weeks.”