2026 could be a better year for wheat, but several factors need to line up to make it happen.
Texas A&M AgriLife Extension economist Mark Welch, College Station, said 2026 wheat production likely will be down from 2025 based on current planted acreage estimates.
“Generally speaking, we are going into a wheat year expecting a smaller crop than in ’25,” Welch said. “That is based on harvested acres little changed and yield back to normal from last year’s record high. But if La Niña takes the top off wheat yields in Texas and Oklahoma, that adds an element that is fundamentally positive for the wheat market.”
Welch said recent hard freezes across much of the Wheat Belt might have pushed prices up momentarily.
“In western Kansas, we saw temperatures dropped to minus 5 [degrees F] or minus 10, but this is the most hardy time of the year for wheat, and it can take low temperatures if the stand is good and well rooted. We will get condition ratings next week, but it will take time to assess whether winterkill will make a difference, even though the market went up, then gave back a bit, and higher again on Jan. 27.
“There may be more going on there — perhaps speculators or supply concerns elsewhere.”
Welch said Kansas wheat is in good shape with minimal drought ratings. Oklahoma and Texas are in broader drought status, he added.
Support from grains
Other grain markets also support wheat, Welch said. “The price of corn influences the wheat market. Corn and soybeans are trading a little higher. If we have friendly reports for biofuel use, higher blending rates for ethanol or a friendlier environment for renewable diesel, that’s good for wheat markets, too.
“Globally, we have little market information from major exporting competitors yet,” Welch said. He said some uncertainty exists with Russia, which has been “a big player and put a lot of cheap wheat on market; any production concerns or export restrictions on them could play into the market.”
Production issues in Europe also could play into the wheat market.
“Wheat has been cheap for a long time,” Welch said. “We would welcome a bump back to normal with a little support from other grains and lower production numbers.”
Breakeven
Welch said July Kansas wheat was up 11 points on Jan. 27, trading at about $5.66. Cash wheat would be significantly lower.
He said creating an accurate budget for wheat in Texas is difficult because of all the variables around how wheat is grown and used. “Costs and revenue in a wheat budget depend so much on yield potential, possible forage income and fixed-cost components that there is no ‘one-size-fits-all’ wheat budget for Texas. But generally speaking, it is hard to make money with wheat when the cash price is below $5. Cash wheat price at anything with a 4 in front is hard to make work.”
Welch said cash wheat in mid-January was averaging $4.30 a bushel in Texas. “Futures markets close to $6 and an improvement on basis would help,” he said.
A huge advantage with wheat, Welch said, is flexibility. “Wheat has a lot of variables that make it work. In Texas, we normally harvest for grain less than 50% of the acres planted. Wheat can provide forage income or the benefits of a cover crop. Government payments, including [Price Loss Coverage] and bridge payments, are a significant help this year.”
Cutting costs
Welch added that drought conditions this year may alter some management plans.
“Wheat production practices offer means to save on inputs,” he said. “Producers might have applied a little pop-up fertilizer early to get started and are holding off on additional fertilizer until it starts to break dormancy in late February or early March. Then they can factor in winter moisture, evaluate the stand, consider forage income alternatives and see where the market goes.
“Wheat producers have a little time to do something if it looks like added inputs will pay,” Welch said. “Even in a drought, wheat roots will go deep to get moisture and nutrients. With current conditions, producers have little worry about rust and other diseases. That’s a wet year problem.”
Decision time
Welch said wheat farmers are closing in on decision time. “They need to decide if it makes sense to invest more in the wheat crop, terminate and plant cotton, or graze it to get more pounds of gain on cattle. Wheat is flexible; even just as cover, it holds and builds soil.”
Welch said the late February USDA Outlook Conference will offer more information on “projected total acres and harvested yield numbers to chew on.”
Strong exports
Export numbers are good, Welch added. “Wheat exports are strong, including a little — very little — to China. Overall, exports are running well above where they need to be to hit the current marketing year target, so USDA might increase the export projection.”
So far, extreme cold weather is not likely to be an ongoing factor for wheat prices. But continued strong export numbers, better prices for other grain crops and expectations of a smaller 2026 wheat crop should provide support for the wheat market, Welch said.