War in the Middle East has raised the prices of oils and corn, wheat – near a two-year high

Palm oil prices rose as much as 10%, soybean oil rose and wheat neared its highest in nearly two years as the Middle East war raised energy and fertilizer costs and raised the risk of supply shortages in agricultural markets, Bloomberg reported.

Palm oil prices rose by the most since 2022, when Indonesia, the largest producer, temporarily banned its exports. Soybean oil futures in Chicago rose 5%, extending their 11th straight day of gains, the longest streak since 2008.

Wheat futures rose more than 3% after a sharp rise on Friday, the biggest since 2024. Corn rose more than 2% and soybeans also rose.

“Grain and oilseed markets are following the energy sector in early trading on Monday. Macroeconomic and energy markets will continue to set the direction for agricultural commodities if the war with Iran escalates,” said Joe Davis, director of brokerage Futures International.

Vegetable oil and meal prices also rose sharply in China on Monday. The most actively traded soybean meal futures on the Dalian Commodity Exchange jumped as much as 6% to 3,066 yuan per tonne, while palm oil hit its daily limit. Rapeseed oil and meal showed similar dynamics on the Zhengzhou exchange.

The rapid rise in oil prices has also heightened concerns about accelerating global inflation, which has negatively affected broader financial markets.

“American consumers could feel it immediately through fuel prices and later through food inflation if transportation and fertilizer tariffs remain high. While most farmers have already locked in prices or purchased inputs for 2026, they could feel the most pressure next year if the Strait of Hormuz is not opened soon,” Davis said.

Demand for palm oil for biofuels is growing again, as the price differential between palm oil and gasoil and soybean oil widens, according to Paramalinam Supramaniam, director of Malaysian brokerage Pelindung Bestari Sdn.

Tags: corn, prices, soybean, wheat, palm oil