Analysis Grains & Commodities
Harvest forecasts push wheat price down
Yield forecasts from the IGC and Ikar, among others, have a price-depressing effect on the wheat market. In Russia, the wheat harvest is expected to be larger than previously expected, according to the new forecasts. In the US, the weather is cooperating quite well for corn and soy growers.
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Choose the subscription that suits youThe September wheat contract on the Matif closed yesterday €2 lower at €195,25 per tonne. That is the lowest price since last September. Wheat also took a step back on the CBoT. The July contract closed 1,4% lower at $5.21 per bushel. Corn moved more sideways and closed ¾ cent lower at $4.09½ per bushel. Soybeans closed 0,2% lower at $10.22¾ per bushel.
A large supply of wheat is weighing on the market. The International Grains Council (IGC) increased its wheat harvest forecast for the 2025/26 season by 2 million tonnes compared to the May forecast. The global grain harvest would thus amount to 808 million tonnes compared to 799 million tonnes a season earlier. The IGC's global wheat production is therefore in line with that of the USDA, which predicts a harvest of 808,6 million tonnes. Incidentally, the IGC has also increased wheat consumption by 1 million tonnes compared to May to 814 million tonnes. The total grain harvest, including wheat, maize, barley, oats, etc., is estimated at 2.377 million tonnes. This is also 2 million tonnes more than in the May forecast.
Market bureau Ikar released an update on the Russian wheat harvest yesterday. Ikar expects that Russia will harvest 700.000 tons more than in the previous forecast. The bureau now estimates the harvest at 84,5 million tons. The USDA and SovEcon expect a Russian wheat harvest of 83 million tons.
Demand is starting
Egypt has meanwhile secured the first Russian wheat of the upcoming harvest, according to several sources. Mostakbal Misr (the successor to the Egyptian state buyer Gasc) has booked an unknown volume of wheat for transport in August and September with a payment term of 270 days. Egypt is one of the major importers of wheat and is seen by analysts as a kind of indicator of demand on the world market.
Relatively favorable weather in the US is not helping the mood on the grain market either. Rain has fallen, especially in the Cornbelt, and more precipitation is coming according to the weather models. Corn and soybeans in particular can benefit from this. In Kansas and Oklahoma, the rain is coming at an unfavorable time in relation to the wheat harvest. On the northern prairies in Montana and North Dakota, the spring wheat could still use some water, but the showers do not reach that far. All in all, 20% of the winter wheat is in a drought area and 25% of the spring wheat.
