USDA sharply increased forecasts for global wheat production and stocks, including for Ukraine, but quotes rose

In the November supply and demand report, USDA experts significantly improved the global wheat balance, increasing forecasts for global production, consumption, and stocks, but quotes still rose following the rise in corn prices.

At the same time, the USDA slightly lowered its forecast for wheat exports from Ukraine - by 1 million tons to 11.5 million tons and from the Russian Federation - by 1 million tons to 39 million tons, although SovEcon analysts lowered their export estimates to 36 million tons.

The forecast for the wheat harvest in Ukraine has been increased by 0.5 million tons to 26.5 million tons, and the estimate of ending stocks has been increased to 7.3 million tons, which will increase pressure on prices in Ukraine.

Yesterday, December wheat futures rose:

• by 0.8% to $217.8/t - for SRW wheat in Chicago (-13.2% compared to the level after the release of the October report),
• by 0.3% to $233/t - for HRW wheat in Kansas City (-13.4%),
• by 1% to $231.4/t - for HRS wheat in Minneapolis (-10.4%),
• by 1.6% to 230.5 €/t or 258.5 $/t - wheat futures on Euronext in Paris (-5%).

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

• The estimate of initial stocks was increased by 1.31 million tons to 282.86 (260.4 in 2025/26 MY) million tons due to reduced consumption in 2025/26 MY.
• The forecast for world production has been increased by 5.1 million tons to 827.5 (844.03) million tons, in particular for Australia - by 1.5 to 32.5 (36) million tons, Argentina - by 1.5 to 23 (27.9) million tons, Ukraine - by 0.5 to 26.5 (24.1) million tons, Kazakhstan - by 0.8 to 15.8 (19.3) million tons.
• The estimate of global wheat consumption has been increased by 1.65 million tonnes to 829.55 (821.6) million tonnes due to increased consumption in Australia, Kazakhstan and Ukraine.
• The forecast for global wheat imports has been reduced by 0.95 million tons to 203.9 (222.4) million tons due to reduced supplies from the Black Sea region.
• The forecast for world exports has been reduced by 0.3 million tons to 208.7 million tons (226 million tons in 2025/26 MY), in particular for the Russian Federation - by 1 to 39 (48) million tons, Ukraine - by 1 to 11.5 (14.1) million tons, while estimates for Australia have been increased by 1 million tons to 24.5 (22.5) million tons and Argentina by 0.5 to 16.5 (19.1) million tons. At the same time, the forecast for wheat exports from the USA has not been changed.
• The estimate of world ending wheat stocks was immediately increased by 4.8 million tons to 280.8 million tons, which exceeds traders' expectations and is only 2 million tons below the 2025/26 MY figure. For Ukraine, the estimate of stocks was increased by 1.2 million tons to 7.3 million tons (2 million tons in 2025/26 MY), for the Russian Federation - by 1 million tons to 20.1 (12) million tons, for Argentina - by 1 million tons, for Australia - by 0.2 million tons and for the USA - by 0.1 million tons.

The world supply of wheat will actively grow in the coming months as the harvest is harvested in Argentina and Australia, as well as in the event of the resumption of active exports from the Black Sea ports of Ukraine and the Russian Federation in the event of the signing of a partial ceasefire at sea, so wheat quotes will continue to remain under pressure.