At the end of 2024, US wheat futures are trading 23-27% lower than last year

Last week, US wheat futures fell another 1-1.5% and are now trading 23-27% lower than last year, on the back of a good harvest in the US this year and favorable weather conditions for winter crops for the 2025 harvest. Meanwhile, European wheat prices have barely changed over the year due to a sharp reduction in EU production this season.

 

March wheat futures rose yesterday:

• by 1.4% to $198.6/t - for soft winter SRW wheat in Chicago (-1.7% per week, -26% per year),
• by 1.1% to $202.5/t - for hard winter HRW wheat in Kansas City (-1.5%, -23.4%),
• by 0.9% to $218.8/t - for durum spring HRS wheat in Minneapolis (-0.5%, -27.5%),
• by 2.2% to €232/t or $241.2/t – for wheat on the Paris Euronext (-0.6%, -2.5%).

 

The quote supports the increase in wheat export supplies from the United States for the second week in a row. For December 13-19, exports increased by 35% compared to the previous week to 403.7 thousand tons, and in total in the 2024/25 MY reached 11.943 million tons, which is 27.2% ahead of last year's pace.

 

European wheat prices are supported by the European Commission's downward revision of its forecast for the 2024/25 common wheat harvest compared to November estimates from 112.3 to 111.9 million tonnes, which would be the worst since 2012/13 and 10.6% below the 2023/24 production. In addition, Turkey's decision to increase its wheat import quota to 25% will lead to higher prices for Russian wheat, which is the main competitor of European grain in North African markets.

 

Recall that on October 3, Turkey partially lifted the ban on wheat imports, which was to be in effect until December 31, 2024, allowing flour mills to import 15% of the required wheat volumes, provided that the remaining 85% of the raw materials are purchased from the Turkish Grain Committee (TMO).

 

The SovEcon agency has lowered its forecast for wheat exports from the Russian Federation in the 2024/25 MY by 0.4 to 43.7 million tons, and estimates it at 36.4 million tons for the 2025/26 MY.

 

In Ukraine, due to the devaluation of the hryvnia, the demand prices for food wheat in the Black Sea ports increased during the week by 100-200 UAH/t to 10,000-10,300 UAH/t or 210-216 $/t, while for feed wheat - only by 50-100 UAH/t to 9,550-9,650 UAH/t or 204-207 $/t. Currently, prices for food wheat in Ukraine are 20% higher than last year, and for feed wheat - by 28%.

 

In the 2024/25 MY, Ukraine exported 9.4 million tons of wheat, in particular in December - 430 thousand tons, while last year these figures were 6.72 million tons and 814 thousand tons, respectively.