The July 2024 Agricultural Market Information System (AMIS) report on the global wheat market provides a comprehensive analysis of current trends and future projections. It paints a detailed picture of the global wheat outlook, providing insights into production, utilization, trade and policy developments.
Changes in production and utilization, with regional variations
The AMIS report highlights a marginal increase in global wheat production for 2024. Improved prospects in major wheat producing countries such as China, India, Kazakhstan, Pakistan, Turkey, Pakistan, Turkey and Ukraine contribute to this upward revision. These gains effectively offset the downward revision in the Russian Federation, providing an overall positive outlook.
China and India, the world’s largest wheat producers, have shown significant improvements in their production forecasts. Favorable weather conditions and improved farming practices have played an important role in increasing yields. Similarly, Kazakhstan, Pakistan and Turkey also reported better-than-expected harvests, further supporting global production levels.
In Ukraine, despite the ongoing conflict, favorable weather conditions allowed for an early harvest, improving the overall production outlook. However, in the Russian Federation, prolonged drought and severe frosts in May negatively affected winter wheat yields. Spring wheat in the region was also affected by dry and cold weather in the west and heavy rains in Siberia.
Global wheat use for 2024/25 is projected to increase slightly, mainly due to high domestic supplies, particularly in Pakistan. Despite this increase, overall use is expected to decline marginally from 2023/24 levels. This nuanced picture highlights regional differences in wheat consumption patterns.
Pakistan’s larger domestic supply has led to a higher forecast for wheat use, reflecting increased demand and consumption. However, this increase is not enough to offset the slight decline in overall global use. Other regions experience different consumption trends, influenced by local production levels and market dynamics.
Trade: Downward revision amid regional shifts
The AMIS report indicates a downward revision in global wheat trade for the 2024/25 marketing year. This revision is mainly due to lower imports by India and Turkey and lower export prospects for the Russian Federation. India and Turkey, both major wheat importers, are expected to reduce their import volumes due to improved domestic production and stock levels. On the export front, the Russian Federation is facing wheat yield challenges, leading to lower export forecasts. These shifts in trade dynamics are indicative of broader trends in the global wheat market, where regional production and consumption patterns significantly influence trade flows.
The AMIS report revises wheat stocks for 2025 slightly upwards, reflecting higher forecasts for China, the European Union and Kazakhstan. However, despite this upward revision, global wheat stocks are projected to fall 1.4 percent below opening levels.
China’s high wheat stocks continue to play an important role in global stocks, while the European Union and Kazakhstan also contribute to the slight increase in ending stocks. However, the overall decline in global stocks highlights the ongoing challenge of maintaining adequate reserves amid volatile production and consumption patterns.
The Crop Monitoring section of the AMIS report provides an overview of wheat crop conditions in various regions, highlighting areas of concern and regions with positive prospects.
In the northern hemisphere, the winter wheat harvest is progressing, albeit with some challenges in parts of Europe, the Russian Federation and Ukraine. Excess water in the European Union has negatively impacted crop growth and field operations, reducing potential yields in countries such as Austria, France, Italy and the Netherlands. In contrast, recent favorable weather in the United Kingdom has helped winter wheat to partially recover, but yields are expected to remain below the 5-year average.
In Turkey, wet and warm weather supports grain filling, while in Ukraine, early harvest due to warm weather offers a positive outlook despite recent dry conditions. The Russian Federation faces a more challenging scenario with prolonged drought and sharp frosts affecting winter wheat, while spring wheat development is hampered by unfavorable weather conditions.
In the southern hemisphere, planting continues in Argentina while crops are improving in Australia. Near-average June rainfall benefits Australian crops, while soil moisture conditions remain below average in parts of Queensland, South Australia and Victoria. In Argentina, planting continues despite delays caused by late harvesting of summer crops.
Policy developments affect the global wheat market
Political developments play an important role in shaping the global wheat market. The AMIS report details some of the key policy measures implemented by major wheat producing and consuming countries.
On June 5, the Brazilian Ministry of Agriculture and Livestock announced minimum purchase prices for wheat grains and seeds for the 2024-25 marketing season. These prices, which are lower than in the previous season, vary by region and reflect average production costs with an additional premium.
Turkey’s Ministry of Agriculture and Forestry suspended wheat imports from June 21 to October 15, 2024, while allowing the export of flour made from domestically produced wheat. The government also announced grain purchase prices for the 2024 crop and maintained support for fertilizer, diesel and certified seed. Wheat producers registered in the Farmer Registration System are eligible for shortfall support payments, further encouraging domestic production.
In India, limits were imposed on wheat stocks held by key supply chain entities to stabilize domestic markets and ensure adequate availability. These measures reflect the government’s efforts to manage domestic supplies and prevent overstocking.
The July 2024 AMIS report provides a detailed and nuanced view of the global wheat market. The market remains complex and dynamic, with slight increases in production, marginally higher utilization, revised trade forecasts and mixed crop conditions. Policy developments in key regions further influence market trends, highlighting the interconnected nature of global wheat supply and demand.
As we move forward, continued monitoring and analysis of these factors will be crucial for stakeholders in the wheat sector. The information provided by the AMIS report serves as a valuable resource for understanding the current state and future prospects of the global wheat market and guides informed decision-making in an ever-evolving agricultural environment.