Crop prices jump amid trade snarls from conflict in Middle East
10/03/2026 (Bloomberg), Kuala Lumpur - Palm oil surged as much as 10%, soybean oil jumped and wheat neared a two-year peak, as the war in the Middle East drove energy and fertiliser costs higher and threatened to tighten supplies across agricultural markets.
Disruptions to crude oil supplies wrought by the conflict are boosting the appeal of crop-based biofuels, lifting demand for vegetable oils and corn.
The effective closure of the Strait of Hormuz – a major conduit for the fertiliser trade – has also led to a spike in the price of crop nutrients as farmers rush to secure supply.
In addition, wartime food security concerns could spark some countries to stock up on staples like wheat.
Palm oil jumped the most since 2022, when top grower Indonesia halted exports.
Chicago futures of soybean oil, palm’s closest substitute, rose as much as 5%, up for an 11th day and headed for the longest run of gains since 2008.
Wheat futures rallied more than 3%, after jumping the most since 2024 last Friday, while corn climbed over 2% and soybeans also rose.
“Grain and oilseed markets are following energy in early Monday trading,” said Joe Davis, director at Futures International, a brokerage.
“The macro and energy markets will continue to lead ag commodities on any escalation of the war on Iran.”
Vegetable oils and meal in China also surged yesterday.
The most actively traded soybean meal futures on the Dalian Commodity Exchange rallied as much as 6% to 3,066 yuan per tonne while palm also rose to hit a daily limit.
Rapeseed oil and meal did the same in Zhengzhou.
Spiking crude prices have stoked fears of faster inflation globally, rattling broader markets.
“The US consumer could see this immediately on prices at the pump, then in food inflation if shipping and fertiliser prices remain firm,” Davis said.
“Although most farmers are locked in on price, or have purchased input needs for 2026, next year may be where farmers feel the pain if the Strait of Hormuz doesn’t re-open soon.”
Meanwhile, according to Paramalingam Supramaniam, a director at Malaysia-based brokerage Pelindung Bestari Sdn Bhd, demand for palm oil for biofuels is returning as discounts against gasoil and soybean oil widen. — Bloomberg