European wheat prices fell again on Monday, pressured by ample global supplies and intensifying export competition. On Euronext, the most-traded March delivery contract slipped 0.6% to €185.75 per ton, while Chicago futures declined 0.8% in early trading. The drop continues the downward trend from last week, as markets remain largely unresponsive to geopolitical tensions amid weak international demand.
US wheat prices also fell sharply after exporters canceled sales of 132,000 metric tons of U.S. white wheat to China. Traders highlighted the significant impact of the Argentine crop, which is available in large volumes at highly competitive prices. A recent cut in Argentina’s export taxes has further boosted demand for Argentine wheat among Asian and African buyers, despite quality concerns linked to weather conditions.
China, through state-owned COFCO International, initiated its first major shipment of Argentine wheat, reinforcing the growing presence of this origin in the global market.
Despite ongoing tensions in the Black Sea region, including Russian attacks on vessels near Ukrainian ports, markets have largely ignored geopolitical developments. Analysts note that prospects of a potential ceasefire in Ukraine remain too uncertain to influence prices, although a broader recovery in Ukrainian exports could further increase global supply pressure.
The U.S. Wheat Associates (USW) reported in its weekly price update on 12 December that “a weak dollar and strong commercial sales provided some support to prices, but abundant global wheat supplies continue to exert the strongest downward pressure on the market.”
According to USW experts, the U.S. Department of Agriculture (USDA) December report, showing 9 million ton increase in global wheat production, bringing total output to a record 837.8 million tons.
At present, wheat markets are driven primarily by global supply fundamentals and competitive pricing, keeping downward pressure on both European and U.S. wheat futures.
