UK wheat markets likely to return above £200/t in early 2025

A bullish outlook for wheat in the first half of 2025 could drive up grain markets, with some industry forecasts predicting UK prices may hit £210/t next spring.

Tighter global wheat stocks are projected to support trade in the new year, with less grain available from many of the major exporting nations.

Independent grain marketing advisers CRM AgriCommodities suggested that the wheat supply squeeze will be felt most in early 2025, and there was limited potential for global wheat supplies to be rebuilt in the short term.

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James Bolesworth, managing director of CRM AgriCommodities, said there is less from a supply point of view and demand is starting to pick up.

He added, however, that the risk for markets was US geopolitics, with uncertainty around potential trade tariffs being imposed by president-elect Donald Trump next year.

UK feed wheat futures have already started to lift and were up by almost £8/t since the start of the month, opening at £191/t on 18 December for the May 2025 contract.

Grain volumes coming out of the Black Sea appear to be waning, according to grain marketing consultancy ODA Connect.

Gary Phillips, consultant at ODA Connect, told Farmers Weekly that the big influence in markets at the moment has been the changing pace of exports from the Black Sea.

He said: “It has been high and above average, and they have shipped in excess of 60% of their exportable surplus. We are in a situation right now where inevitably the pace of wheat being exported from the Black Sea will slow down.

“This should provide opportunities for European wheat to become more competitive, and, in due course, lead to sympathetic [price] movements for British wheat.”

Mr Phillips added that the UK market was “the dry leaves being blown around by global turbulence” due to its position as a net importer of wheat.

A 1.3m-tonne cut to the EU’s wheat crop to 121.3m tonnes in last week’s World Agricultural Supply and Demand Estimates report by the US Department of Agriculture has also been supporting global markets.

Meanwhile, increased production in Australia and Argentina has partially offset lower production elsewhere.

UK supply

Defra’s final crop estimates for 2024 put wheat production down by 20% on the year at 11.1m tonnes.

This was the lowest production figure in four years, but was still slightly higher than previous estimates.

Matt Darragh, cereals and oilseeds analyst at AHDB, said the slightly larger wheat crop estimate leads to a slight increase in availability this season, at 16.88m tonnes.

Looking ahead to 2025, AHDB’s Early Bird Survey indicates the overall UK wheat area is forecast to rise by 5% on the year to 1.6m hectares, but remain below the five-year average.

Imports

HMRC figures showed UK wheat import volumes were up by 80% during the first four months of the 2024-25 crop year compared with the five year average.

A favourable exchange rate for importers linked with reduced domestic supplies has made the UK an attractive market.