Global wheat supply deficit triples, increasing upside price risks

Global wheat production in MY 2026/27 is estimated at 822.39 mln tons, while consumption is expected to reach 827.9 mln tons. As a result, consumption is projected to exceed production by 5.51 mln tons, compared with 1.6 mln tons in the September forecast. This is according to the October USDA WASDE report released on October 9. The deterioration in the global wheat balance increases the risk of further price growth. According to available estimates, the tighter global balance could support wheat prices in the range of $230–260/t.

At the same time, USDA lowered its global wheat trade forecast by 2.8 mln tons from the September estimate to 208.97 mln tons. Global ending stocks are projected at 276.04 mln tons, down 250 thsd tons from the previous forecast. According to market estimates, global wheat prices have risen by 44.8% over the past year, while tighter supply conditions create a basis for prices to remain elevated.

Against the backdrop of a tightening global wheat balance, some exporters are increasing shipments. In particular, the EU wheat export forecast has been raised from 28 mln tons to 32 mln tons, with production estimated at around 133 mln tons. The US also maintains its position in the global market, although its wheat crop is estimated at 48.2 mln tons. Meanwhile, Argentina and Australia are expanding exports thanks to strong harvests, intensifying competition among major suppliers.

However, not all countries can fully realize their export potential due to logistical constraints, particularly in the Black Sea region. USDA lowered its forecast for Russian wheat exports from 43 mln tons to 40 mln tons due to disruptions at Black Sea ports and slower shipments, while ending stocks were raised from 16.09 mln tons to 19.09 mln tons. For Ukraine, the wheat export forecast remains unchanged at 12.5 mln tons, despite an expected increase in production to 26 mln tons. Ukraine’s export capacity is constrained by Russian attacks on port infrastructure, limited capacity of alternative routes, and high logistics costs. As a result, Ukraine’s wheat ending stocks could rise to 6.1 mln tons, compared with 2 mln tons in the previous season.

Tags: prices, wheat, supply and demand balance, crop forecast