U.S. wheat and corn commodity prices spiked 60 percent and 30 percent, respectively, during the first quarter of this year as Russia’s invasion of Ukraine continued to drive prices higher, according to a recent Federal Reserve Bank of Kansas City report.
According to Markets Insider, corn was trading at more than $8 per bushel on May 12, and soybeans were trading at $16.45 per bushel. According to the World Bank, this comes as the war in Ukraine deals the largest shock to commodity markets since the 1973 oil crisis. In a typical year, Ukraine and Russia account for more than one-quarter of global wheat exports. The World Bank expects high prices to last through the end of 2024.
U.S. ag prices surged by 12 percent from Q4 2021 and 30 percent from one year ago, according to the Kansas City Fed. Dairy prices jumped 20 percent in the first quarter. Export values continued to increase during the first part of 2022.
U.S. Department of Agriculture Chief Economist Seth Meyer said earlier this year that strong commodity prices for soybeans, wheat, cotton and beef products will push ag exports to $183.5 billion, an $11.3 billion jump from 2021.
“Despite the relatively optimistic outlook, input costs continued to rise, and could weigh on profit margins in the year ahead,” according to the Kansas City Fed.