Ukraine may disrupt wheat market

Ukraine needs to find new markets for its wheat because of a sharp projected curtailment in European Union imports, according to the U.S. Department of Agriculture.

The EU imported slightly more than 12 million tonnes of wheat in 2022-23, more than double its typical volume of purchases.

It continued importing “unprecedented quantities” over the next two years, receiving 12.7 million tonnes in 2023-24 and 10.7 million tonnes in the crop year that just ended.

“Ukraine alone accounted for about half of these substantial imports,” the USDA’s Foreign Agricultural Service (FAS) stated in its recent Grain: World Markets and Trade report.

However, the EU gravy train appears to be coming to an end for Ukraine.

The EU temporarily removed tariff-rate quotas on Ukrainian wheat in 2022. That policy, known as Autonomous Trade Measures, provided a “vital market” for the war-torn country.

Those measures expired in June 2025, and the previous quotas were reinstated.

“The change in trade policy coincides with a significant increase in EU production,” stated the FAS.

Production is expected to be up 13 percent compared to last year due to increased area and yield.

“This will reduce the need for wheat imports overall, and particularly from Ukraine,” stated the FAS.

EU wheat imports are expected to plummet to slightly more than six million tonnes in 2025-26.

The FAS expects Ukraine to shift exports back to its traditional markets in North Africa, Southeast Asia and South Asia.

Ukraine is forecast to export 15.5 million tonnes of the cereal crop in 2025-26, which would be a similar volume as last year.

Dennis Voznesenski, agricultural economist with the Commonwealth Bank of Australia and author of War and Wheat, said Ukraine’s shift in exports will pressure prices in North Africa and Asia.

In a recent issue of his Agri Commodity Weekly Alert publication, he noted that momentum for a peace deal between Russia and Ukraine could further pressure world wheat prices.

AgResource Company president Dan Basse is also not very optimistic about the wheat market due to lacklustre demand for the commodity.

“World wheat trade is stagnating,” he said.

Hard red winter wheat December futures have been steadily declining since March, setting new contract lows daily.

Meanwhile, Russia and Ukraine keep ratcheting up production.

Basse said it is not good news that the EU has stopped buying large volumes of Ukrainian wheat. It is going to be tough to find new markets for that displaced wheat, which could further depress prices.

“The global price of wheat is not set in Winnipeg or Vancouver or Chicago; it is set in Moscow or the Black Sea, and Ukraine is part of that,” he said.

Russia was selling its wheat for US$233 per tonne as of Aug. 27. The world’s leading exporter keeps dropping its price to stimulate demand.

“They need to get wheat out the door. Their export pace has been very slow here in July and August,” said Basse.

However, the main buyers aren’t purchasing much these days. For instance, China is expected to import six million tonnes of wheat in 2025-26, down from 13.8 million tonnes a couple of years ago.

Tags: markets, area, Ukraine, export, European Union, Production, wheat, crop, yield, imports, quotas