The March 2026 contract for CME Soft Red Wheat reached a significant milestone on December 17, 2025, as it declined to contract lows. Despite a slight rebound, closing at $5.08 per bushel on December 18, 2025, the market remains beleaguered by concerns over global supply and competitive pricing. The recent news from the USDA have exacerbated these challenges, with the agency reporting that exporters had canceled sales of 132,000 metric tons of US white wheat to China, a move that underscores the competition in the world wheat market.
Market players suggest that China’s decision to cancel US wheat imports may be driven by increasingly competitive pricing from Argentina. The South American nation has made significant strides to enhance its appeal in the global wheat market, notably by reducing its wheat export tax from 9.5% to 7.5%. This reduction makes Argentine wheat an attractive option amid the swelling global supplies, further pressuring US wheat to compete on price rather than just quality. With estimates for wheat crop production ticking upward in both Australia and Argentina, the increase in available global supply serves to weigh down prices across the board.
Overall, the ample global wheat supply continues to paint a bearish picture for prices, particularly for US wheat, which struggles to maintain its price points amidst robust competition. The situation emphasizes the intricate interplay of regional production, export policies, and international trade relations. As wheat producers across the globe face this glut, the market outlook hinges on strategic adjustments, both in production decisions and diplomatic trade relations, to stabilize and potentially recover pricing. Market players will be closely monitoring developments, especially in the Black Sea region, as any shifts with the Ukraine-Russia war could impact the amount of wheat available for export.
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Written by Murphy Campbell
