During October, March 2026 Chicago wheat futures gained nearly 60 cents of value thanks to strong U.S. wheat export demand. In November, wheat futures gave back approximately half of that 60-cent gain. What will December bring for wheat prices? A re-test of recent highs? Modest sideways price action? Or might something trigger prices to wash out lower?
What’s happened
The November WASDE report was perceived as neutral to slightly negative. The USDA lowered planted wheat acres slightly to 45.3 million acres, down from 45.4 million acres on the September report. (Remember, there was no October report due to the government shutdown.) Harvested acres did increase by 600,000 acres to 37.2 million acres. USDA raised yield from 52.7 to 53.3 bushels per acre.
The USDA made no demand adjustments on the report, but the increase in production created an increase in ending stocks. The new ending stock number of 901 million bushels was well above pre-report expectations, and much higher than the September number of 844 million bushels. This weighed on wheat prices.
From a marketing perspective
Heading into next week’s WASDE report, trade is not expecting any U.S. production changes for wheat. However, traders are eager to see whether USDA increases demand for U.S. wheat exports in the Dec. 9 report. The November WASDE report pegged exports at 900 million bushels, unchanged from the September report.
However, weekly export sales and export inspections reports suggest that the current pace of export demand for U.S. wheat is running well ahead of current USDA projections. If true, that would likely lower the ending stock number for wheat, and thus potentially be supportive to prices.
Regarding global supplies, the November WASDE provided production increases for Argentina, Australia, Canada, the European Union, Russia and Kazakhstan. Global production increased 12.7 MMT to 829 MMT. Because of this, global ending stocks surged 7.3 MMT to 271.4 MMT, well above expectations
This global increase in production also weighed on prices. However, now that the calendar has flipped to December, Chicago wheat seasonals suggest potential for sideways to higher trading from now until mid-February.
Prepare yourself
The Dec. 9 USDA report likely will influence the future direction of wheat prices. Traders will be eager to eye U.S. exports and ending stocks.
Also continue to monitor the Black Sea region as the war in Ukraine/Russia is far from over.
Lastly, continue to monitor the action of managed money fund traders. Now that the government is open again, the weekly Commitment of Traders reports are slowly being released. The managed money fund traders are still short a plentiful amount of wheat futures (the current guesstimate is short approximately 85,000 contracts) on the perceived “known” negative fundamental bias of plentiful global wheat supplies.
Just be aware, any ripple of war escalation, or a global production hiccup, could swiftly change the sentiment in the wheat market. Be ready for anything. Plenty of uncertainty lies ahead.
Reach Naomi Blohm at 800-334-9779, on X: @naomiblohm, and at naomi@totalfarmmarketing.com.
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