CANBERRA: Chicago soybean, corn and wheat futures rose on Friday after reports that Israeli missiles had hit a site in Iran fuelled fears of escalating conflict in the Middle East and pushed oil prices sharply higher.
However, all three contracts were still close to their lowest levels since 2020 amid plentiful supply.
The most-active wheat contract on the Chicago Board of Trade (CBOT) was up 3.6% at $5.73 a bushel by 0250 GMT, with CBOT corn 1.2% higher at $4.41-1/4 a bushel and soybeans up 0.7% at $11.57-1/4 a bushel.
Oil prices rose by around 3% amid concerns that Middle East oil supply could be disrupted.
Traders fear that expanding violence in the Middle East could impact shipments in the region and from Russia, the world’s biggest wheat exporter and an ally of Iran, said Commonwealth Bank analyst Dennis Voznesenski.
Higher oil prices, meanwhile, push up the value of ethanol and its feedstocks, which include corn and soybeans, he said.
While wheat was headed for a weekly gain of around 3% and corn for a weekly rise of around 1.5%, soybeans remained on track to end the week down 1.5%.
Chicago wheat recoups some losses as US dollar eases
Prices are under pressure from strong supply of wheat from Russia, soybeans from South America and corn from South America and the United States.
Iran last weekend launched hundreds of drones and missiles in a retaliatory strike on Israel after a suspected Israeli strike on its embassy compound in Syria.
Most of the drones and missiles were downed before reaching Israeli territory, with minimal damage and casualties.
Israel had said it was going to retaliate.
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