Wheat market steadies as war premium fades and new-crop risks build

The wheat market is stabilising as the war premium from the Persian Gulf conflict fades, while attention shifts back to new‑crop prospects and a still‑comfortable global balance. Nearby Euronext contracts are range‑bound around 205–210 EUR/t, with only modest support from weather risks in the US Plains and a slightly lower EU soft wheat crop outlook.

Despite the calmer tone, the market remains finely balanced between solid Northern Hemisphere crop conditions and lingering concerns about frost damage, fertiliser prices and weak EU export competitiveness, particularly for Germany. With Coceral trimming its EU+UK soft wheat forecast and EU exports lagging origins such as Russia, rallies are likely to be capped, but deep price breaks may attract demand from importers and domestic feed users.

📈 Prices & Term Structure

Euronext (MATIF) milling wheat is flat across the curve, signalling a market in search of direction rather than a clear bull or bear trend.

Contract	Exchange	Last price (EUR/t)	Comment
May 2026	MATIF	207.5	Nearby benchmark, unchanged day-on-day
Sep 2026	MATIF	215.25	Moderate carry vs May 26
Dec 2026	MATIF	221.25	Further carry, reflecting storage & risk premium
Mar 2027	MATIF	224.5	Curve flattens beyond 2026

The forward curve from May 2026 through spring 2028 rises only gradually from about 207–208 EUR/t to around 228–231 EUR/t. This modest contango points to adequate medium‑term supply expectations rather than a structural shortage. Open interest is highest in the nearby months, underlining that liquidity and price discovery are still concentrated in the 2026 crop.

On CBOT, May 2026 wheat trades around 607 USc/bu, with a mild upward bias across later contracts. Converted to roughly 225–230 EUR/t (depending on freight and basis), US prices remain competitive at destination against EU origin, especially when combined with a firm euro. ICE feed wheat in the UK shows a similar gently rising structure from about 198–205 EUR/t equivalent, reflecting comfortable feed grain availability.

🌍 Supply & Demand Balance

The immediate geopolitical risk premium from the Persian Gulf conflict is receding, with freight flows adapting and no widespread disruption to physical wheat exports reported. As a result, traders are refocusing on production prospects and relative competitiveness between origins.

Coceral has slightly lowered its forecast for the 2026 EU+UK soft wheat crop to 142.6 million tonnes, down from 143.9 million tonnes in December and below the strong 148.7 million tonnes harvested in 2025. The revision mainly reflects expectations of more normal yields after last year’s exceptionally high levels, rather than a weather‑driven shock.

Within the EU, Germany’s output is projected at 21.56 million tonnes, down from 22.99 million tonnes in the previous season. While this is not a dramatic cut, it trims Germany’s exportable surplus and underscores the importance of yield realisations in the coming weeks. In Southern Europe, crop development has entered a critical stage under very favourable soil moisture, offering upside potential if conditions remain mild.

📊 Exports, Demand & Competitiveness

EU soft wheat exports since the start of the 2025/26 season have reached 16.77 million tonnes by 15 March, up about 8% year‑on‑year. This headline growth masks a shift in origin mix and ongoing competitiveness issues for some member states.

• Romania leads with 5.51 million tonnes of soft wheat exports so far this season.
• France follows with 4.57 million tonnes.
• Poland and Lithuania contribute 1.92 and 1.81 million tonnes respectively.
• Germany trails with only 1.31 million tonnes, and exports have increased just 90,000 tonnes over the last two weeks.

This pattern underlines that Germany is struggling to place wheat competitively on world markets, pressured by a stronger euro and cheaper offers from the Black Sea and other EU origins. Traders expect Russian shipments to accelerate in the coming weeks, which could cap any attempts at a sustained price rally on Euronext unless fresh weather or policy shocks emerge.

🌦️ Weather & Crop Conditions

Weather conditions for the Northern Hemisphere wheat crop are, overall, described as good. Soil moisture in much of Europe is adequate to above average, supporting yield potential and aligning with Coceral’s expectation of only slightly lower, more normal yields after the bumper 2025 harvest.

In the United States, a cold spell has passed over the southern Plains. Because soils there have been notably dry, traders fear that winter wheat plants may have been more vulnerable to frost damage than usual. The actual extent of any yield loss will become clear only in the coming weeks as crops resume active growth, making this a key driver to watch for global price direction.

💶 Physical Market Snapshot (Indicative)

Physical export offers corroborate the futures picture of a relatively calm, well‑supplied market, with only modest differentiation by origin and quality.

Origin & spec	Location / terms	Latest price (EUR/kg)	Approx. EUR/t	Trend vs early March
Wheat, 12.5% protein, 98% purity	UA, Odesa, FOB	0.19	190	Flat
Wheat, 11.0% protein, 98% purity	FR, Paris, FOB	0.29	290	Flat
Wheat, 11.5% protein, 98% purity	US, CBOT-linked, FOB	0.21	210	Flat

Ukrainian FOB values around 185–190 EUR/t remain highly competitive into Mediterranean and MENA destinations. French 11% wheat around 290 EUR/t FOB Paris sits at a premium to Black Sea origin, which, combined with the stronger euro, helps explain the sluggish pace of German and some French exports despite overall higher EU shipments.

📆 Market Outlook & Trading Ideas

With geopolitical risk fading for now and good early crop conditions, the balance of risks for MATIF wheat leans slightly bearish to sideways in the short term, but weather‑related volatility is likely to increase as crops enter key development stages.

• Producers (EU): Use current prices around 205–215 EUR/t (May–Sep 26) to layer in incremental hedge coverage, especially where production costs are already locked in. Consider options strategies to retain some upside in case US Plains damage or new geopolitical shocks tighten the balance sheet.
• Importers: Maintain a patient buying strategy but use dips towards 200 EUR/t on MATIF and sub‑190 EUR/t FOB Black Sea as triggers to cover nearby needs, given the risk that any confirmed US frost losses or a drier late spring in Europe could push prices back into the 220–230 EUR/t range.
• Traders: The modest contango and weak German export performance favour carry and quality‑spread strategies rather than outright directional bets. Monitor Russian export pace and any shift in US crop ratings as key catalysts.

📍 3‑Day Price Indication (EUR)

• MATIF milling wheat May 2026: Expected to trade broadly sideways in a 203–210 EUR/t range, with a slight downward bias if the euro remains firm and no new US weather damage is confirmed.
• CBOT SRW May 2026 (EUR/t equivalent): Likely to fluctuate in a tight band around 220–230 EUR/t, tracking US weather headlines and speculative positioning.
• Black Sea FOB 11.5–12.5% wheat: Indicatively stable around 185–195 EUR/t, keeping pressure on EU exporters and acting as a ceiling for nearby MATIF rallies.