Market Update: Wheat Futures Surge Amid Weather Concerns and Grain Inspections Decline

1. Wheat Futures Surge in Overnight Trading

Wheat futures experienced a notable increase in overnight trading, driven by technical buying and concerns over potential declines in Russian wheat production. Investors who previously shorted the market—betting on lower prices—are now buying back their contracts, thus realizing profits from earlier declines.

Consultancy SovEcon forecasts Russia’s wheat production to drop to 83.8 million metric tons in the 2026/2027 season. This reflects a decrease from previous estimates of 89.5 million metric tons for the 2025/2026 season. This drop is attributed to a reduction in planted acreage, with 38.5 million acres of winter wheat sown, marking a 1.3% decrease year-over-year.

Despite earlier declines in wheat futures, driven by anticipations of rain in the U.S. southern Plains—where hard red winter varieties are in overwintering—a dry spell is now expected in parts of western Kansas, Oklahoma, and the Texas panhandles. This has raised concerns, with the National Weather Service issuing red flag warnings across much of the region, citing winds reaching 25–35 mph and gusts up to 55 mph, alongside a relative humidity drop to as low as 8%.

As of the latest trading session, March delivery wheat futures rose 6 cents to $5.48½ per bushel on the Chicago Board of Trade, while Kansas City futures gained 8 cents to $5.58½ per bushel. Additionally, corn futures increased by 1½ cents to $4.37¼ per bushel, and soybean futures rose by 8½ cents to $11.57¼ per bushel.

2. Grain Inspections Decline Week-to-Week, USDA Reports

Recent data from the USDA indicates a week-to-week decline in inspections of corn and wheat for overseas delivery. For the week ending February 12, corn inspections totaled 1.49 million metric tons, down from 1.61 million tons the previous week and 1.62 million tons during the same period the previous year.

Wheat inspections were reported at 375,402 metric tons, a significant decrease from 580,619 tons the week prior, although this is an increase compared to 250,829 tons inspected at the same time last year. Meanwhile, soybean inspections showed an increase to 1.2 million metric tons, up from 1.14 million tons the previous week.

Overall, since the start of the marketing year on September 1, corn inspections sit at 35.7 million metric tons, an increase from 24.7 million tons last year. Conversely, soybean assessments have fallen to 24.3 million metric tons, down from 36 million tons at the same point last year. Wheat inspections for the current marketing year have reached 17.7 million metric tons, up from 14.9 million tons last year.

3. Blizzards Forecast for Northern U.S. Amid Dry Conditions

The National Weather Service has forecasted blizzard conditions for states in the northern U.S., specifically issuing warnings for counties in north-central South Dakota, where 2 inches of snow and wind gusts up to 55 mph are expected. These “ground blizzards” can create extremely hazardous travel conditions.

Winter storm warnings are also in effect along the Canadian border in North Dakota, Minnesota, and Wisconsin, with predictions of up to 6 inches of snow in northern Minnesota, alongside gusty winds reaching 40 mph. Conversely, parts of Nebraska, Iowa, and Illinois are experiencing extremely dry conditions. In central Iowa, winds are expected to sustain between 25–35 mph with gusts potentially reaching 50 mph, while relative humidity could fall as low as 12%. The National Weather Service advises against outdoor burning, as any fires that develop may spread rapidly.

Conclusion

As the market adjusts to these evolving conditions, traders and farmers alike are keeping a close watch on weather patterns and production forecasts. The balance of supply and demand continues to hinge significantly on these factors, making it essential for stakeholders to stay informed and prepared for potential shifts in the agricultural landscape.

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