Global Wheat Output Set to Decline Amid Weather Risks
Global wheat production is forecast to decline to 821 million tonnes in 2026-27, while consumption rises to 828 million tonnes, tightening supplies. El Niño, higher input costs and geopolitical tensions are supporting wheat prices despite larger crops expected in Russia and Ukraine.
Kedia Advisory – Global wheat production is projected to decline by 23 million tonnes in the 2026-27 season as El Niño, higher input costs, and geopolitical tensions reduce acreage across major producing regions. The International Grains Council forecasts production at 821 million tonnes against consumption of 828 million tonnes, leading to lower ending stocks. Dry weather in Europe, reduced wheat sowing in Australia, and historically low US acreage are expected to tighten supplies. Meanwhile, fertilizer disruptions linked to the Iran conflict and continued Black Sea uncertainties are adding pressure, supporting global wheat prices despite higher production expected in Russia and Ukraine.
Key Highlights
- Global wheat production is forecast to fall 23 million tonnes to 821 million tonnes in 2026-27.
- Wheat consumption is expected to exceed production, reducing global ending stocks to 279 million tonnes.
- El Niño, higher fertilizer costs, and geopolitical tensions are reducing wheat acreage across major exporters.
- US wheat acreage has dropped to its lowest level in nearly a century, while Australia recorded a seven-year low in wheat sowing.
- Tightening global supplies have supported CBOT wheat futures, trading near two-year highs around $6.54 per bushel.
Wheat prices remained well supported as expectations of lower global production and tightening inventories strengthened market sentiment. Concerns over adverse weather linked to El Niño, rising fertilizer costs following the Iran conflict, and ongoing geopolitical disruptions have raised fears of reduced wheat availability during the 2026-27 marketing season.
Supporting prices, the International Grains Council (IGC) forecasts global wheat production at 821 million tonnes, down from 844 million tonnes in the previous season. At the same time, global consumption is projected to increase to 828 million tonnes, resulting in production falling short of demand. Consequently, ending stocks are expected to decline to 279 million tonnes from 285 million tonnes, indicating a tighter global supply balance.
The US Department of Agriculture (USDA) also projects lower global wheat production, citing smaller crops in the United States and Canada despite improved harvest prospects in Russia and Ukraine. US wheat acreage has fallen to its lowest level in nearly a century, while Australian wheat sowing has dropped to a seven-year low as growers shift toward oilseeds and other crops due to rising production costs. In Europe, prolonged dry weather and repeated heatwaves have damaged crop development across France, Germany, Belgium, Poland and other key producing regions, prompting lower production estimates.
Global trade is forecast to decline to 205 million tonnes from 216 million tonnes, while continued disruptions to Black Sea exports and fertilizer shipments from the Persian Gulf remain key risks. Although increased exports from Argentina, Russia and Ukraine may provide some relief, tightening global supplies are expected to keep wheat prices firm in the coming months.
Lower global production, rising consumption, adverse weather and geopolitical uncertainties are expected to keep wheat market fundamentals supportive, with supply risks likely to sustain elevated prices.
To Read more about Wheat News continue reading Agriinsite.com
Source : Investing.com
