Global supply pressures limit U.S. wheat market upside despite strong demand

An ag economist says the wheat market currently faces a tough situation.

Greg McBride with Allendale says there’s very good demand for U.S. wheat. “You just saw the USDA increase the export demand number on Friday’s report.”

But he tells Brownfield the problem is that any sustained upside might be limited by the large global supply.

“Whether it’s Russia, the EU, or Australia, all these numbers continue to come in a little bit better. Australia is in the early stages of harvest right now and that’s a big situation because they are big exporters.”

McBride says there are solid production prospects for Argentina, Ukraine, and Russia.

“Russia being the largest exporter out there, they are increasing their production and increasing the overall export demand they are expected to see. That’s going to weigh on us.”

The European Union’s MARS says Ukraine’s soft wheat yield is expected to be below average, citing inconsistent weather. France’s Ag Ministry has soft wheat production at 33.3 million tons, up slightly from the last guess and larger than average.

Tags: Production, wheat, yield, U.S., Market, demand, soft wheat, Ukraine, export