Israel’s Wheat Import Shake-up: Black Sea to US—Policy, Prices & Market Impact

Israel’s wheat import policy is on the cusp of a seismic shift, set to reverberate through regional and global markets in the coming months. The government’s decision to impose a 50% import duty on non-US feed wheat, aimed at strengthening trade ties with Washington and gaining export concessions, marks a targeted departure from traditional, Black Sea-oriented sourcing. Black Sea wheat—particularly Russian—currently dominates, supplying roughly 60% of Israel’s annual imports. If the proposed tariffs take effect in April as planned, Black Sea supplies will lose their competitive edge while US wheat’s market share could climb, supported further by freight subsidies now under consideration. The ripple effects are manifold: Israeli livestock and poultry producers may see input costs surge, which could flow through to consumer food prices, while Black Sea exporters confront new barriers. Meanwhile, the trade calculus for US and Israeli negotiators includes not only wheat, but a broader agricultural free trade framework with the phased removal of duties on 30 agri-food products. Yet, this policy reorientation is not without domestic controversy, as Israeli farmers and industry voices warn of volatility and inflation risk—particularly for feed-dependent sectors. The market landscape is poised for disruption, with sourcing patterns, price volatility, and cost management challenges all hinging on tariff implementation and ensuing US-Israel negotiations.

📈 Wheat Prices at Key Exchanges

Origin	Location	Protein (%)	Delivery	Price (EUR/kg)	Weekly Change	Market Sentiment
USA (CBOT)	Washington D.C.	11.50	FOB	0.21	0.00	Neutral
Ukraine	Odesa	11.00	FOB	0.18	0.00	Pressured
France (Euronext)	Paris	11.00	FOB	0.29	0.00	Steady

🌍 Supply & Demand Shifts

• Israel to raise import duties to 50% on feed wheat from all countries except the US, reshaping a market where the Black Sea region, led by Russia, holds a 60% share of imports.
• Israel’s projected wheat import volume for the season: approx. 2.15 million tonnes—all but entirely imported.
• Main driver: As part of negotiations with the US, Israel seeks to reduce the current 15% tariff on Israeli exports, with a 50% reduction targeted.
• Feed wheat specifically to be impacted; milling wheat for human consumption remains duty-free for all suppliers.
• Subsidies on freight for US wheat imports (potentially EUR 193 million over 10 years) would further advantage US wheat.

📊 Fundamentals & Market Drivers

• Policy change basis: Part of a revised US-Israel free trade agreement, expanding duty-free access for 30+ agri-food products over 10 years.
• Black Sea (especially Russian) wheat at risk: New duties will undercut competitiveness for feed wheat, potentially shifting global trade flows.
• Domestic impact: Israeli farmers and industry groups warn of higher costs to livestock producers and likely increases in consumer food prices, especially poultry.
• Feed price volatility: With shifting supply sources, market participants expect greater short-term price swings in Israel.

🌦️ Weather & Yield Outlook

• Israel: Weather is currently not the primary driver; feed wheat is largely imported.
• Key Exporting Origins (Black Sea, US): Monitor for winterkill and wetness risk in the Black Sea; Midwest US wheat crops currently stable.
• Standard seasonal conditions expected; external shocks (drought/flooding) could add upward price pressure globally.

🗺️ Global Production & Stock Situation

• Russia: Top exporter; faces diminished competitiveness in Israeli feed market due to new tariffs.
• Ukraine: Key secondary supplier, will also be impacted by Israeli duties.
• USA: Set for greater access to Israeli market—further supported by freight subsidies.
• Israel: Nearly all wheat imported; no major domestic buffer.

🔎 Trading Outlook: Key Points & Recommendations

• Black Sea exporters: Prepare for erosion of Israeli market share; consider alternative buyers.
• US exporters: Position for increased demand from Israel—especially feed wheat—if tariffs are implemented and freight subsidies confirmed.
• Israeli buyers/feed users: Anticipate higher feed input costs, potential for increased feed price hedging.
• Speculators: Expect initial volatility as importers recalibrate sourcing and adjust to policy changes.

📆 3-Day Price Forecast (Key Exchanges)

Exchange/Origin	Current Price (EUR/kg)	3-Day Forecast	Sentiment
CBOT (US, FOB)	0.21	0.21 — 0.22	Firm to higher
Euronext (France, FOB)	0.29	0.29 — 0.30	Steady
Ukraine (Odesa, FOB)	0.18	0.17 — 0.18	Pressured

Outlook: Israeli policy pivot toward US wheat is likely to add support for US-origin prices, keep Black Sea prices under pressure, and maintain overall market volatility as the sector reacts to policy and sourcing realignment.