September was a good month for the benchmark Chicago wheat market, with prices churning mainly higher.
As can be seen on the chart below, the nearby December future has rallied about 75 cents/bu or almost 14% since late August to the current price of about $5.98 (as of midday Wednesday), the highest since early July.
The bulk of the recent gains have been weather related, with Russian winter wheat planting reportedly proceeding at the slowest pace in 11 years amid dryness, raising questions about the 2025 crop. Meanwhile, Australian fields have been hit with both frost and dryness, denting that country’s production potential as well. Winter wheat fields in parts of Argentina are reportedly being abandoned amid a lack of rain. Meanwhile, US winter wheat areas are now also being impacted by drought, with No. 1 producer Kansas particularly hard hit.
In its September supply-demand update, the USDA projected 2024-25 world wheat production at a new record high of 796.9 million tonnes, but that is still down 1.4 million tonnes from the previous month. Meanwhile, despite a record large crop, global wheat ending stocks for 2024-25 are seen by the USDA at 257.2 million tonnes - a nine-year low.
Wheat stocks in the major exporting countries (US, Canada, Australia, the EU, Argentina, Ukraine, Kazakhstan, and Russia) are tightening as well, estimated at 54.4 million tonnes, 12% below the recent five-year average.
December Chicago Wheat: source – Barchart
