Winter wheat climbed higher for a fourth straight day as a deep freeze across the US grain belt escalates concern about shrinking crops.
The extreme cold snap is putting recently planted wheat in danger of winterkill, which can occur when soil lacking enough snow protection can grow cold enough to kill off the plant. Grains in some key areas already are the focus of worry over ongoing drought.
“The cold weather could produce some winterkill in US production areas to make a small crop even smaller,” said Jack Scoville, vice president of Chicago brokerage Price Futures Group.
Record-cold temperatures are striking as the Russia-Ukraine war continues to limit farm exports from two of the world’s top grain shippers. Corn and soybeans in South America also are in focus amid weather woes in the region, while delayed harvests in Brazil and Thailand fuel higher sugar prices. The supply issues raise the prospect of more food inflation in 2023.
The Bloomberg Agriculture Spot Index was heading for third weekly gain as of Thursday, with most markets extending gains Friday. That would be the longest streak of weekly gains since May.
Hard red winter wheat futures rose for a fourth day in Chicago, the longest such streak since August. The most-active futures contract is poised to end the week up 3.6%, the biggest jump since late September.
Benchmark Chicago wheat rose as much as 2% to $7.7775 a bushel on Friday, the highest since Dec. 2. The futures are headed for a second straight week of gains.
Corn and soybeans in Chicago also gained as dry weather and rising temperatures are poised to return in Argentina on Sunday, further stressing crops. Raw sugar climbed higher for a sixth straight trading day on tight global supplies amid slower-than-expected global harvests.
Read more: Crop prices set for third week of gains as us freeze threatens
--With assistance from Samuel Gebre and Marvin G. Perez.
Follow us on social media: