Rally in wheat prices may be just beginning

Global wheat prices ended the week on a strong note, with market participants increasingly believing the rally may only be getting started. Escalating tensions in the Black Sea continue to fuel concerns over wheat exports from Ukraine and Russia, prompting traders to reassess the global supply outlook.

On Friday, September CBOT soft red winter wheat futures climbed to $250.86/t, while Kansas City hard red winter wheat futures rose to $269.05/t and Minneapolis spring wheat futures reached $254.17/t. All three major U.S. wheat exchanges closed higher, reflecting growing bullish sentiment.

Analysts note that this price rally differs from previous short-lived Black Sea spikes. If export capacity from Ukraine and Russia is significantly reduced by ongoing security risks, the global wheat balance could tighten considerably, providing further support for international prices.

Additional strength came from higher wheat prices in Romania and Bulgaria, where demand for safer export routes pushed values in the ports of Constanța, Varna and Burgas to their highest levels since June 2024. The premium for wheat shipped through these ports has widened the price gap with Russian and Ukrainian wheat to around $25/t.

Strong demand for U.S. wheat has also supported the market. According to the USDA, new-crop wheat export sales had reached 2.06 mln tons as of July 9, representing 10% of the agency’s seasonal export forecast and running ahead of the five-year average pace. Meanwhile, France has already harvested 92% of its wheat crop, yet the arrival of new supplies has done little to slow the upward momentum in European wheat prices.

Tags: Ukraine, Russia, prices, Black Sea region, wheat, war