- Wheat futures prices have dropped from record highs due to ample supplies, particularly from Russia, which has record stocks.
- Despite some export efforts from Ukraine, USDA forecasts indicate a decline in wheat stocks, affecting global prices.
- The decline in global wheat prices is attributed to supply issues worldwide, with Russia’s surplus and falling export prices being significant factors, potentially impacting economies heavily reliant on wheat trade.
Wheat futures fall after record highs
Two years ago, wheat futures in Chicago reached record highs on concerns over Russia’s invasion of Ukraine. Now, however, they have fallen to their lowest level since August 2020, similar to corn and soybeans. While the global supply outlook for wheat appears relatively optimistic compared to other crops, USDA estimates show a decline in global wheat ending stocks, which have reached an eight-year low for the 2023-24 season. Major exporters are reporting a decline in stocks relative to consumption to a three-year low of 14.8%.
Sufficient supply drives decline in global wheat prices
The fall in global wheat prices is attributed to ample supplies from top exporters such as Russia, whose record wheat supplies and falling export prices have added to the downward pressure. Despite Ukraine’s commendable export efforts, the USDA expects wheat stocks to decline for the 2023-24 season. In 2024, CBOT wheat prices have fallen significantly, down 15% from the beginning of the year and around 24% from the previous year. This underscores the prevailing pessimism among traders, albeit not as much as in the case of corn and soybeans.
