Wheat supplies for 2025/26 are expected to surge to 837.8 million tons, increasing downward pressure on prices.

The global wheat market for the 2025/26 crop year is facing a serious oversupply situation. According to a report from the US Department of Agriculture (USDA), global wheat production is expected to reach 837.8 million tons, an increase of 37 million tons compared to the previous crop year. This increase, combined with projected ending stocks of 274.9 million tons (an increase of 14.8 million tons), is creating widespread downward price pressure and pushing exporting countries into fierce competition.

Abundant supply from key areas.

A significant surplus was evident from the start of the season in the Black Sea region, with a projected yield of 136.5 million tons, an increase of 10.3 million tons compared to the same period last year. Russia contributed the largest increase (+7.2 million tons), followed by Romania (+2.8 million tons). Ukraine also recorded a harvest of 22.9 million tons, a slight increase from the 22.5 million tons of the previous year.

Besides the Black Sea, supply also increased sharply in many other markets such as France (up 7.6 million tons), Argentina (up 9.2 million tons), Canada (up 4 million tons), and Australia (up 1.5 million tons). This simultaneous recovery has put continuous pressure on wheat prices in major exporting countries since mid-summer, despite short-term recoveries due to weather or shipping factors.

Ukraine faces a dual challenge: quotas and infrastructure.

Ukraine's wheat exports during the July-December 2025/26 period reached only 7.86 million tons, a sharp decrease compared to the 9.86 million tons in the same period of the previous year. The main reason for this is the EU's reinstatement of tariff quotas on Ukrainian grain from June 6, 2025. The initial wheat quota was set at 1 million tons and increased to 1.3 million tons from the end of October 2025.

As a result, Ukrainian wheat exports to the EU fell from 34% to just 6% of total exports. To compensate, Ukraine shifted heavily towards the North African market, led by Egypt (importing 2.03 million tons) and Algeria (1.2 million tons). However, attacks on port infrastructure in the Greater Odesa region and the railway network increased insurance and shipping costs and disrupted supply chains, significantly reducing the competitiveness of Ukrainian wheat.

Competitive pressure from Russia and the Southern Hemisphere.

Russia is consolidating its position with projected export quotas of up to 20 million tons for the period from February 2026 to June 2026, almost double that of the previous season. This indicates immense pressure to offload its stock from Russia in the second half of the crop year. Meanwhile, Southern Hemisphere suppliers such as Australia and Argentina are also entering the market with record production.

• Australia:Exports are projected at 27 million tons, a significant increase from last year's 23.7 million tons, with a focus on the Southeast Asian market.
• Argentina:Exports are projected to reach 14.5 million tons. The government has reduced the export tax on wheat from 9.5% to 7.5% to enhance competitiveness.
• EU:Exports of soft wheat are expected to reach 31 million tons, up from 25.5 million tons last year following a bumper crop.

Overall, with approximately 45.5% of Ukraine's export potential remaining unfulfilled and its ending inventories potentially rising to 2.5 million tonnes (the highest since 2022/23), the market outlook for the second half of 2025/26 remains challenging. Global oversupply and a reluctance to lower prices from some suppliers due to high risk costs will continue to be major obstacles to trade.