Wheat quotes rose by 2.1-3.6%, responding to strikes on Russian ports, not to USDA report data

Wheat prices rose sharply yesterday amid heavy attacks on Russian grain terminals in Novorossiysk and the shutdown of their operations. The USDA's August world wheat balance was little changed, although analysts had expected a significant reduction in export forecasts from the Russian Federation and Ukraine, according to the forecast of their representative in Ukraine , who the day before had lowered his export estimate for Ukraine by 3.7 million tons. However, USDA experts reduced the forecast for wheat exports from Ukraine by only 1 million tons.

Yesterday, September wheat futures rose:

• by 3.6% to $239.8/t for SRW wheat in Chicago (+1.9% to the level after the release of the July report);
• by 3.1% to $264.8/t for HRW wheat in Kansas City (+6.6%);
• by 2.1% to $247.3/t for HRS wheat in Minneapolis (+3%);
• by 3.4% to €220.5/t or $254.6/t - for wheat on Euronext in Paris (+2%).

At the same time, December futures are trading $6-7/t more expensive than September ones, which indicates the market's expected deterioration in the global balance and increased demand in the second half of the season.

Compared to July estimates, the world wheat balance for the 2026/27 MY has undergone the following changes:

• The forecast for initial wheat stocks has been increased by 1.2 million tons to 280.22 (260.48 in 2025/26 MY) million tons.
• The global production forecast has been reduced by 0.67 million tonnes to 819.30 (843.4) million tonnes, including for the EU - by 1.8 to 134.2 (145.1) million tonnes, the UK - by 1.5 to 12 (11.96) million tonnes and the USA - by 0.15 to 41.66 (54) million tonnes due to dry conditions, which will be offset by an increase in forecasts for Ukraine by 1.4 to 25.4 (24.1) million tonnes, Canada - by 1 million tonnes to 35 million tonnes (40 million tonnes) and Kazakhstan - by 1 million tonnes to 16 million tonnes (19.4) million tonnes.
• The estimate of global wheat consumption was left unchanged at 826.26 (823.6) million tons, but the forecast of feed wheat consumption in the EU was increased by 2 million tons due to a reduction in the corn harvest.
• The forecast for global wheat imports has been increased by 0.1 million tons to 208.28 million tons, which will be significantly lower than the 2025/26 MY figure (221.4 million tons) due to a good harvest in importing countries.
• The forecast for world exports has been reduced by 0.26 million tons to 212.7 million tons (227.4 million tons in 2025/26 MY), in particular for Ukraine - by 1 million tons to 13.5 million tons (14 million tons), the Russian Federation - by 1.5 to 46 (48) million tons, which will be offset by an increase in exports from Canada by 1 million tons to 28.5 (29.6) million tons and from Kazakhstan - by 1 million tons to 10 (11.5) million tons.
• The estimate of world ending wheat stocks in the 2026/27 MY has been increased by 0.41 million tons to 273.25 million tons, which will be 7 million tons lower than the 2025/26 MY figure.

Rainfall in Argentina and Australia continues to improve the prospects for the new harvest, so markets will react mainly to news about the suspension or restriction of exports from the Black Sea ports of the Russian Federation and Ukraine, but now the rather calm reaction of the markets to the suspension of exports is associated with rumors about negotiations between the Russian Federation and Ukraine, initiated by Turkey to restore safe shipping in the Black Sea, and traders are reacting more to rumors than to news.