Rains in Ukraine fuel wheat crops and hopes for better harvest
12 May 2025 11:49
Powerful atmospheric fronts brought the long-awaited precipitation to the territory of Ukraine, which should help to improve the condition of winter wheat crops. This is stated on the website of the electronic grain exchange GrainTrade, reports
According to weather forecasters, rainy and cool weather will last for another 7-8 days, and in this regard, analysts have already begun to revise pessimistic crop forecasts in Ukraine and Russia upwards.
What was the price situation like
In March-April, high prices for black sea wheat were supported by dry conditions in the region, despite the decline in prices in the US and the EU. However, the improvement of weather conditions triggered a sharp drop in prices.
Export prices for milling wheat decreased by 2-4 $/t to 228-234 $/t (or 10 900-11 100 UAH/t), and for feed wheat – by 4-6 $/t to 218-222 $/t (or 10 300-10 500 UAH/t)
Some traders have suspended purchases of feed wheat due to the lack of export demand in view of its high price.
What is the situation with exports
In the first 7 days of May, the country exported only 136 thsd tonnes of wheat.
Since the beginning of 2024/25 marketing year, Ukraine has shipped 14 mln tonnes, which is 17% less than last year – 16.386 mln tonnes.
By the end of the season, another 2 million tons are expected to be exported.
Forward prices for the new harvest (with delivery to ports) are as follows:
– milling wheat – 215-219 $/t,
– feed wheat – 205-207 $/t.
Against this background, traders are gradually reducing prices to the level of the new harvest.
As a reminder, in early May, the Ukrainian Grain Association predicted that if dry weather conditions persist, wheat production in Ukraine in 2025/26 marketing year may decrease by 10-15% from the current forecast of 22.5 mln tonnes. Last year’s harvest, according to the Ukrainian Grain Association, amounted to 22.4 million tons. The association noted that the increase in sown areas should compensate for a slight decrease in yields.
In contrast, the U.S. Department of Agriculture (USDA) office in Kyiv predicts that Ukraine can harvest only 17.9 million tons of wheat in 2025. This is the lowest figure in 13 years and is 23% lower than in 2024. The reason is extremely dry land during the sowing season and low profitability of production, which led to a reduction in acreage.
The World Bank expects food prices to decline
According to the World Bank’s forecast, published in the new Commodity Markets Outlook, global food prices will decline by 7% in 2025 compared to the previous year, and by another 1% in 2026.
Thus, this year all three components of the price index will decline, in particular, cereals – by 11%, vegetable oils and meals – by 7%, and other food products – by 5%. Prices for rice are expected to decline by 29%, soybeans by 17%, and poultry by 4%.
