Wheat and corn surge as Black Sea risks meet hawkish Fed

A war-driven commodity shock and a hawkish Fed are hitting the same import bills at once. Wheat settled at 784 cents a bushel on Friday, its highest close since February 2023, up 12.1% on the week and more than 54.5% YTD, CNBC reports. December corn settled at 536.5 cents a bushel, its highest close since July 2023 and up 21.8% YTD. The corn contract was up 15.6% in August, putting it on track for its best month since April 2021.

IN CONTEXT- This rally comes as Russia prepares to intensify attacks on Ukrainian infrastructure after peace talks reached a dead end, Bloomberg reported last week. Russia and Ukraine together account for more than a quarter of global wheat exports, while damage to port and grain export infrastructure, attacks on vessels, and rising ins. costs are disrupting what is still moving through the Black Sea and Sea of Azov. The exposure isn’t uniform. Jordan had already canceled two wheat tenders and two barley tenders that month after receiving few offers amid high prices and shipping risk. Tunisia was warning suppliers against invoking force majeure. Indonesia — the No. 2 global buyer — had locked in roughly 600k tons from former Soviet exporters for July-September while already scouting Bulgaria, Australia, Romania, and Argentina as backups, Reuters reported last week. Algeria, Bangladesh, Thailand, and Vietnam also rely heavily on Russian and Ukrainian wheat.

Egypt is the sharpest case in that group. The country is the world’s largest wheat importer and sourced more than 82% of its wheat imports from Russia and Ukraine in the first half of 2026. Unlike Jordan or Tunisia, Egypt’s bread subsidy program is a fixed budget line, not a purchase it can defer. The private sector, which handles more than half of Egypt’s wheat needs and holds thinner inventories than the state buyer, is absorbing most of the near-term pain, and President Abdel Fattah El Sisi has discussed the threat to food supplies directly with his Ukrainian counterpart Volodymyr Zelenskyy.

Egypt’s exposure isn’t limited to wheat. The country is also a major corn importer for poultry and animal feed, with Brazil supplying roughly half those inflows through mid-May 2026. A corn rally on top of a wheat rally means the feed and protein side of the food bill is moving at the same time as bread.

Then there’s the currency leg. Fed Chair Kevin Warsh’s Friday remarks at Jackson Hole read hawkish enough that markets are now pricing higher odds of a September hike, CNBC reports, with Principal Asset Management’s Seema Shah telling the network that “the positive market reaction highlights that investors place a premium on policy clarity, even when that clarity carries a more hawkish message.” Every importer on that list is now paying more USD for the same wheat, with less room from the Fed to absorb it, but Egypt may be carrying a bigger, less flexible bill than Jordan’s or Tunisia’s.

MARKETS THIS MORNING-

Asian markets opened lower today, with Japan’s Nikkei and South Korea’s Kospi both about 0.5% in the red. This tracks with Wall Street’s overnight losses across the Dow Jones, S&P 500, and Nasdaq.

THE CLOSING BELL-

The EGX30 fell 0.1% at yesterday’s close on turnover of EGP 18.2 bn (63.9% above the 90-day average). Local investors were the sole net buyers. The index is up 31.2% YTD.

In the green: AMOC (+7.1%), Qalaa Holdings (+4.7%), and GB Corp (+3.9%).

In the red: Orascom Investment Holding (-4.3%), Juhayna (-3.3%), and Edita (-2.4%).