The global grain market is demonstrating a persistent downward trend, forcing domestic exporters and producers to adjust their price expectations.
In mid-June, global wheat prices continued to fall. The imminent arrival of new season grain, as well as macroeconomic and geopolitical factors, are putting significant pressure on the market.
Drivers of the Decline: From Geopolitics to Oil Prices
The current decline in wheat prices is the result of a confluence of several market factors:
New harvest factor.
The physical market traditionally reacts with lower prices as the mass harvest approaches.
Large volumes are expected in Romania, Bulgaria, Ukraine, and throughout Europe. High harvests are also forecast in southern Russia.
Political Agreements.
The expected signing of a memorandum between the US and Iran was a significant trigger. The document envisages the full opening of the Strait of Hormuz, which significantly reduces logistical risks in the region.
Energy Market.
The fall in oil prices is dragging down the entire commodity sector. As Vladimir Petrychenko, CEO of ProZerno, notes, falling energy prices will continue to put pressure on grain, which could prolong the downward trend.
Against this backdrop, export prices for Russian wheat (12.5% protein, FOB Black Sea) have fallen to $238–240 per ton.
Dmitry Rylko, head of the Institute of Agricultural Development and Crop Protection, adds that the discount between the old and new harvests is currently around $4 per ton—$238 versus $234, respectively.
Balance Adjustment: USDA Forecasts and Season Specifics in Russia
Despite the overall price decline, the US Department of Agriculture (USDA) in its June report raised its forecast for the 2026/27 wheat harvest in Russia by 2 million tons, to 88 million tons.
Our country’s export potential is estimated to be stable at 47 million tons.
However, the current season holds several serious surprises for Russian farmers:
Harvesting Campaign Delay.
The start of the active harvest phase in Russia is delayed by at least a week. Because of this, grain from the new harvest will begin to reach the market later than usual.
Export Port Shortages.
In regions close to port infrastructure, stocks of old grain are almost depleted. A harvesting campaign delay could create a short-term local supply vacuum.
Quality Issues.
Late ripening dates and weather conditions leave the quality characteristics of future grain unclear, which, according to IKAR experts, could pose problems.
Redistribution on the Global Market
While Turkey is reducing wheat imports to 5.5 million tons, and Syria and Morocco are tightening their belts, Egypt is of key interest to Russian suppliers.
The USDA has raised its purchase forecast for this country by 1 million tons, to 13.5 million tons, due to growing domestic consumption.
Russia will face competition from the United States, where the condition of winter and spring crops has improved, and harvesting is ahead of schedule.
Price pressure is a reason to focus on cost control and improving grain quality, as high-quality wheat will command a premium in this uncertain environment.
