Wheat Market in Turmoil: Russia’s Struggles Shake Global Balance

Russia’s wheat market—the bedrock of global grain supply—is in uncharted territory. A strengthening ruble and faltering international prices have heaped pressure on Russian exporters and farmers, even as the government makes attempts to stave off an export drop. Recent data show Russia’s wheat shipments plunging 18.5% in 2024 versus last year, with only 60% of the prior year’s volumes shipped since the agricultural year began. The temporary repeal of export duties offered scant relief, and a symbolic duty is returning. Meanwhile, the ruble’s appreciation from 100 to 80.4 per USD has erased much of Russia’s price edge, while producers anxiously hope for currency devaluation to restore their margins.

With key suppliers facing such headwinds, the global wheat market faces sparks of volatility at a time when Ukrainian, French, and US wheat is also under weather scrutiny. If Russian exports remain constrained, importers may pivot swiftly to alternative origins—further intensifying demand for EU and Black Sea supplies. In this backdrop, traders, buyers, and policymakers should brace for a season where geopolitics, currency swings, and nature could upend familiar trends.

📈 Wheat Prices: Key Global Benchmarks

Exchange/Market	Product	Location	Delivery	Latest Price (EUR/kg)	Prev. Price	Weekly Change (%)	Market Sentiment
Kyiv (UA)	Wheat, min. 11.50% protein	Kyiv	FCA	0.24	0.24	0.0	Neutral
Odesa (UA)	Wheat, min. 11.50% protein	Odesa	FCA	0.26	0.25	+4.0	Moderately Bullish
Washington D.C. (US/CBOT)	Wheat, min. 11.50% protein	US	FOB	0.23	0.22	+4.6	Bullish
Paris (FR/Euronext)	Wheat, min. 11.00% protein	Paris	FOB	0.29	0.28	+3.6	Bullish
Odesa (UA)	Wheat, min. 12.50% protein	Odesa	FOB	0.21	0.20	+5.0	Bullish
Russia (Black Sea)	Wheat, 12.5% protein	Russia	FOB	235.00 (USD/t)	~245.00 (est)	-4.0 (est)	Bearish

🌍 Supply & Demand: Russian Pressure & Global Shifts

• Russian Exports: Down 18.5% YoY to 44 million tons in 2024, now only 60% of last year’s export pace since July. Policy interventions (temporary export duty cut) provided fleeting volume relief, but a symbolic duty is returning.
• Currency Effect: Ruble’s appreciation to 80.4 per USD weakens Russian competitiveness; exporters’ revenues shrink as production costs rise.
• Ukrainian, EU, and US Wheat: Ukraine’s offers remain competitive but face logistics, security, and weather risks. US (CBOT) and French (Euronext) wheat prices have ticked up on renewed import demand and weather concerns.
• Demand Outlook: Weak global tenders from major buyers (e.g., Egypt, Turkey) but potential for short-term buying bursts if Russia restricts further.

📊 Fundamentals: Global Production & Stocks

Country/Region	2024 Production (est. mln t)	2024/25 Stocks (mln t)	Key Notes
Russia	85.0	15.0	Exports under severe cost pressure
Ukraine	21.0	3.3	Volume stable, logistics remain a risk
EU	126.0	13.5	Weather a concern in France, Germany
USA	49.0	15.7	Expecting lower end stocks, crop quality mixed
China	137.0	142.0	Major importer, high inventories
India	108.5	18.0	Unlikely to export, domestic stability prioritized

☁️ Weather Outlook: Crop Risk Analysis

• Black Sea (Russia, Ukraine): Generally favorable weather, though some dryness persist in southern Russia. Risk of late summer drought affecting quality if high temperatures return.
• EU (France, Germany): Brief spells of excessive rain delayed harvests. Dry periods needed to avoid fungal issues; next 10 days show slightly below-average rain and moderate temps—favorable if trends hold.
• US Plains: Improved soil moisture noted, but some heat stress in Kansas and Oklahoma could dent hard red winter wheat yields.

📆 Trading Outlook & Recommendations

• Bullish tilt for EU and US wheat as Russian export uncertainty intensifies.
• Monitor Russia’s currency moves—potential ruble weakening could spark selling, weigh on prices mid-term.
• End users: Consider forward coverage in EU & US origin wheat if supply tightens or Russian flows slow further.
• Speculators: Watch for price spikes on further Russian cutbacks or adverse Black Sea/Western Europe weather.

🔮 3-Day Regional Price Forecast

Market	Current Price (EUR/kg)	Forecast (EUR/kg)	Direction
Kyiv (UA, FCA)	0.24	0.24-0.25	Stable/Bullish
Odesa (UA, FCA)	0.26	0.26-0.27	Slightly Bullish
Paris (Euronext, FOB)	0.29	0.29-0.30	Slightly Bullish