A Global Wheat Market Update – 13th January 2025
Posted by Emma on 14th Jan 2025
In the UK, the wheat market has largely mirrored global trends, with prices remaining steady. Winter wheat planting has seen a much smoother season than last year, particularly in Essex and surrounding counties. Favourable autumn weather allowed most farmers to complete their drilling by November, significantly increasing winter wheat acreage.
Despite these positives, UK wheat prices have struggled to remain competitive. The country faces a supply glut with a 2–3 million tonne carryover from the 2024 season and high levels of imported wheat entering the market. This oversupply and farmers’ reluctance to sell at current prices have created a challenging environment. As more imported wheat is consumed, domestic stocks remain under pressure, further complicating the situation for UK farmers.
The wheat market has been a picture of stability in recent weeks, with prices holding firm amid limited external influences. However, a mix of global factors, from weather to export policies, is shaping the market’s future trajectory beneath this calm surface.
Global wheat prices have increased after a quiet period between Christmas and New Year. For instance, the Canadian Western Red Spring (CWRS) price rose by £10 per tonne to £296. This increase can partly be attributed to a strengthening dollar and a weakening pound, making imports more costly for buyers in the UK.
In the Black Sea region, wheat exports have slowed significantly. Starting mid-February,Russia’s self-imposed export quota of 10.6 million tonnes aims to address concerns about lower production forecasts for the next crop season. Ukraine, meanwhile, has introduced government-enforced minimum prices to address tax evasion claims, further curbing export volumes. These policy shifts have created uncertainty in a region traditionally known for its significant contribution to global wheat supplies.
The U.S. Department of Agriculture’s (USDA) January 2025 World Agricultural Supply and Demand Estimates (WASDE) report offered a neutral outlook for wheat. While global wheat production forecasts have slightly risen to 793.24 million tonnes, the focus has shifted to South America. Dry weather in southern Brazil and Argentina is raising alarm bells. Rainfall is desperately needed to avoid potential crop failures, while northern Brazil’s excess rain could delay the planting of the second maize crop. This is particularly important as wheat and maize are often used interchangeably in animal feed and bioethanol production, meaning disruptions in one market can ripple into the other.
Adding to the complexity, political developments in the U.S. are keeping markets on edge. With Trump’s inauguration just days away, concerns over potential tariff changes add an unpredictable element to the volatile global wheat market.
As the wheat market navigates this period of relative stability, the interplay of global weather events, export restrictions, and political uncertainty will likely dictate its future. For UK farmers, maintaining competitiveness amid oversupply and evolving global conditions will require innovative approaches, collaboration, and a sharp eye on market trends.