A surge of wheat supplies globally has been the lead talking point pushing winter wheat futures in to a downward spiral since early November. Major wheat producing countries such as Russia, Ukraine, and Argentina have all taken action to reduce export taxes on the grain this year, signaling that their countries are likely dealing with supplies that easily exceed their needs for domestic consumption.
Cash markets around the world are also showing signs of abundant wheat stocks. USDA tracks average monthly grain prices at various major ports internationally, releasing an update to that data last week. Every foreign port tracked showed a decrease from the start of the marketing year. USDA’s data shows U.S. prices firmly in the middle among major producers. Still, movement to the upside is limited, as the class of Canadian wheat tracked by USDA is of slightly higher quality than most grown in the U.S.
With wheat being abundant in so many locations, it gives buyers of wheat around the world the upper hand in negotiations, forcing sellers to keep prices competitive with numerous other markets that also have high supplies.
Domestic markets tell a similar story. While cash prices have bounced from their early-fall lows, they remain below the five-year averages for this time of year. Basis for hard red wheat in particular is significantly wider than normal, with reports showing some bids in north Texas reaching a dollar below the March board.
The next major update for U.S. wheat supplies will come in January, when USDA reports its expectations for wheat acres seeded for harvest in 2026. A majority of economists expect acres to decline due to poor prospects on returns for growing the crop, as we reported earlier this year.