Wheat Market Update - 13th January 2025
Welcome to this week’s market update! Each week, we'll delve into the market movements and key factors affecting wheat prices. Whether you're a fellow industry professional, a supplier, or simply interested in what’s happening in the market, our updates will offer valuable insights to keep you ahead of the curve.
Market Report
Global Market
The market stabilised between Christmas and New Year, with prices remaining firm due to a lack of significant news to push them in either direction.
Black Sea exports have slowed considerably, primarily due to reduced wheat availability in Russia, following a self-imposed export quota of 10.6 million tonnes from 15th February to 30th June. This comes amid concerns about lower production forecasts for the 2025/2026 crop. Ukrainian wheat exports have also declined as sellers adapt to ‘minimum prices’ imposed by the government in an attempt to curb alleged “tax evasion” by exporters selling below market value. The strengthening dollar and the weakening pound contributing to the bullish CWRS price, which is up £10 a tonne from last week.
The USDA’s January 2025 WASDE report has just been released, presenting a neutral outlook for wheat but a supportive one for corn. Global wheat production forecasts have risen slightly from 792.95 million tonnes to 793.24 million tonnes.
Turning to South America, a developing weather story is attracting attention. Southern Brazil and Argentina have turned dry, with rainfall urgently needed. Meanwhile, northern Brazil has received good moisture for soybean crops, but prolonged rains could delay the planting of the second safrinha maize crop. Don’t forget that maize and wheat prices are closely linked, as both are key ingredients in animal feed and can be used in bioethanol production. A disruption in the supply of one grain can significantly impact the pricing and availability of the other due to their substitutive role in global markets.
Looking ahead, Trump’s inauguration next week continues to add another layer of uncertainty. Mixed messages on tariffs keep the market wary, and if history is any guide, an unpredictable Trump administration could continue to create volatility in the coming years.
UK Market
The UK market has largely continued its sideways trend over the past week. Winter wheat plantings in Essex and surrounding counties look promising. Despite a wet start to the autumn, the rain stopped in time, allowing most winter wheat to be drilled by November—a stark contrast to the previous year, when persistent rain caused significant delays. This season, acreage that had previously been reserved for spring crops has been brought back into winter wheat production, thanks to the success of the winter drilling campaign. Additionally, favourable conditions have enabled farmers to apply effective treatments to manage black-grass, a persistent issue during the 2024 crop season.
The 2024 season concluded with a 2–3 million tonne carryover. Combined with high import levels, this has left the UK with an ample wheat supply. However, UK wheat prices remain uncompetitive, limiting farmer selling. With each passing month, more imported wheat is consumed, with farmers reluctant sellers at these prices, adding to the overall supply glut and further pressuring prices.
