Inna Stepanenko
Senior Grain Analyst
ASAP Agri
After a strong export performance in the first half of the 2024/25 marketing year, Ukraine’s wheat shipments now face mounting challenges. The outlook hinges largely on Russia’s export quota — if restrictive, it could create opportunities for Ukraine to strengthen its foothold in key markets like Egypt and Turkey. However, hurdles remain, with Turkish import restrictions and shifting Egyptian procurement policies complicating trade prospects. Meanwhile, abundant wheat supplies from the Southern Hemisphere are set to heighten competition in Southeast Asia, where cheaper Australian wheat continues to dominate. With just 6 MMT of Ukrainian wheat available for export in the second half of the season, the pressure is on.
WHEAT EXPORT POWER SHIFTS IN 2024/25
The 2024/25 MY marks a shift in global wheat export landscape. Traditional suppliers in the Black Sea region and the EU have faced reduced export potential, while exporters in the Southern Hemisphere and North America are stepping up to fill the gap.
In its Jan WASDE report, the USDA trimmed Russia’s wheat export forecast by 1 MMT to 46 MMT, down sharply from 55.5 MMT last season and 49 MMT two years ago. Ukraine’s export outlook was also revised downward by 0.5 MMT to 16 MMT, falling 2.6 MMT below LY’s level and coming in just under the Ukrainian government’s export cap. If realized, this would mark Ukraine’s lowest wheat export volume since 2014/15.
The EU’s wheat export potential has also taken a hit, now pegged at 29 MMT, a steep decline from 38 MMT last season and the lowest level since 2018/19.
France, the EU’s top wheat exporter, is projected to ship 3.5 MMT of soft wheat outside the EU in the 2024/25 season, marking the lowest level since 2000/01, according to FranceAgriMer. The decline comes amid a poor harvest and intense competition from Russian supplies. Prolonged rains during crop development slashed France’s wheat output to 25.4 MMT in 2024, down from 34.8 MMT in 2023, European Commission data shows.
In contrast, Australia and Argentina are poised for strong export growth. Australia’s wheat exports are forecast at 25 MMT, surging from 19.8 MMT last season, while Argentina is expected to ship 11.5 MMT, a strong rebound from 8.2 MMT in 2023/24.
North America is also set to bolster global supply. U.S. wheat exports are projected at 23.1 MMT, the highest in four years, rising from 19.2 MMT last season. Meanwhile, Canada’s wheat exports may climb slightly higher to 26 MMT, up from 25.4 MMT in 2024/25.
Ukrainian wheat exports surge in first half of 2024/25, but declines ahead
Ukraine delivered a strong wheat export performance in the first half (FH) of the 2024/25 MY, shipping 9.9 MMT between July and December. This marks a significant jump from 7.6 MMT in the same period of 2023/24, fueled by the successful operation of the Ukrainian grain corridor, this season, compared to slow activity same time last season, as corridor was launched only in August 2023.
ASIA AND NORTH AFRICA DRIVE UKRAINIAN EXPORT GROWTH
Exports to Asia and North Africa surged in the first half of 2024/25, with Indonesia emerging as Ukraine’s second-largest wheat importer of Ukrainian wheat. Shipments to Indonesia more than doubled, soaring from 551 KMT in the first half of 2023/24 to 1.5 MMT this season, making Ukraine the dominant supplier to the market. Other key Asian buyers also ramped up purchases:
- Vietnam nearly tripled its imports, jumping from 293 KMT to 816 KMT.
- Thailand saw an impressive rise from 47 KMT to 638 KMT.
- Bangladesh increased imports from 129 KMT to 467 KMT.
Dr. Mykhailo Lytvyn
CEO of MVE PROSPERA AG
North Africa also played a major role in Ukraine’s wheat export boom. “Algeria, Tunisia, and Egypt were the primary destinations for Ukrainian 11.5% protein milling wheat during the first half of the season. In contrast to Turkey, which, was largely inactive due to changes in its import procedures,” said Dr. Mykhailo Lytvyn, CEO of a Swiss-based trading company MVE PROSPERA AG.
- Egypt increased its purchases to 800 KMT, up from 608 KMT last year (LY).
- Algeria’s imports skyrocketed to 748 KMT, a drastic increase from just 32 KMT.
- Tunisia’s wheat imports surged from 45 KMT to 448 KMT.
Many of these gains came at the expense of EU exporters, highlighting Ukraine’s growing competitiveness in these markets.
EU SHIPMENTS DECLINE, WHILE TURKEY BECOMES A CHALLENGE
While Ukraine made strides in Asia and North Africa, shipments to the EU dropped from 4.6 MMT in the first half of 2023/24 to 3.4 MMT this season. This decline was largely due to reduced transshipment via Romania’s Constanta port, as Ukraine’s deep-sea ports resumed operations.
Despite the decline, the EU remains Ukraine’s largest wheat export destination. Spain, the EU’s top buyer of Ukrainian wheat, just slightly lowered its imports to 2.4 MMT from 2.6 MMT, while Italy increased its purchases from 371 KMT to 395 KMT.
Turkey, however, posed a significant setback. Wheat shipments to Turkey collapsed from 370 KMT to just 34 KMT due to an import ban in place from 6 Jun to 3 Oct, 2024. Even after the ban was eased, a new quota system limited Ukraine’s access:
- 85% of imports must go through Turkey’s Grain Board (TMO) before buyers can access the remaining 15% via the Inward Processing Regime.
- Alternatively, importers can choose to fulfill 100% of their quota through TMO, making competition tough for Ukrainian wheat.
SECOND HALF OF 2024/25: A TOUGH ROAD AHEAD
The key question now is: how will Ukraine’s wheat exports hold up in the second half of the season?
While Russia’s upcoming export quota could ease some competitive pressure, Ukraine still faces headwinds:
- Rising competition from the Southern Hemisphere and North America.
- A tighter export cap — this season, Ukraine’s wheat exports are limited to 16.2 MMT, down from 18.6 MMT in 2023/24, as per a memorandum between the government and market participants.
With 9.9 MMT already shipped during July-December 2024, Ukraine has just 6.1 MMT left for export in the second half of 2024/25, or 38% of the total quota. As a reminder, the January WASDE report revised Ukraine’s potential downward to 16.0 MMT.
With competition heating up and supply constraints tightening, Ukraine’s wheat export momentum is set to slow, making the second half of the season a more challenging one to navigate.
STRONG COMPETITION IN 2024/25 DESPITE RUSSIAN EXPORT CONSTRAINTS
Despite a 10 MMT drop in Russian wheat production to 81.5 MMT in 2024/25, according to USDA estimates, Russia exported 28 MMT from Jul to Dec, up from 25.1 MMT a year earlier. Key gains were recorded in Egypt, Morocco, and Algeria, where Russian wheat displaced EU supplies.
For the full season, USDA projects Russia’s wheat exports at 46 MMT, though local analysts SovEcon and IKAR forecast them slightly lower at 43.7 MMT and 43.5 MMT, respectively. With 28 MMT already shipped, Russia has 15.5-18 MMT of exportable surplus left. However, a government-imposed export quota of 10.6 MMT (15 Feb – 30 Jun, 2025) marks a sharp 62% reduction from last season's 29 MMT quota, limiting Russia’s market presence. That said, the quota could still be adjusted.
SOUTHERN HEMISPHERE SUPPLIES TO KEEP GLOBAL WHEAT AVAILABILITY STRONG
Despite potential Russian export constraints, global wheat supply remains ample, with Australia and Argentina significantly boosting exports after restoring production volumes.
Australia is projected to export 25 MMT in 2024/25, with harvest running from Oct to Feb, meaning the bulk of its supply is still hitting the market, increasing competition. However, Australian exports to China have plummeted due to stricter import restrictions aimed at protecting local farmers. Reports suggest that Cofco Corp., China’s state-owned trader, has resold Australian wheat cargoes to Indonesia and Thailand, intensifying competition in alternative markets.
Also, quality concerns may also impact Australia’s export performance. Heavy rains in Dec downgraded approximately 2.5 MMT of wheat from milling to feed quality, affecting 8-16% of the total crop.
Similarly, Argentina is expanding its wheat exports, with the USDA forecasting shipments at 11.5 MMT, based on a crop estimate of 17.5 MMT, up from 15.9 MMT LY. However, the Buenos Aires Grain Exchange (BAGE) reported a final harvest of 18.6 MMT, suggesting Argentina may have even more wheat available for export.
In a move to boost competitiveness, Argentina’s government announced a cut in export taxes on key agricultural commodities, effective 27 Jan to 30 Jun, 2025. For wheat, the tax was reduced from 12% to 9.5%, further supporting export potential.
NORTH AMERICA HOLDS STRONG EXPORT POSITION
U.S. wheat exports totaled 9.7 MMT from Jul to Nov, up from 7.2 MMT the previous year, with strong demand from Japan, South Korea, and the Philippines. However, the U.S. lost market share in the Middle East, with Black Sea wheat capturing more sales. With a 2024/25 export forecast of 23.1 MMT, the U.S. has 13.4 MMT available for the rest of the season.
Canada’s wheat exports reached 10 MMT over the same period, slightly below LY’s 10.3 MMT, with slower demand from China but stable sales in key Asian markets. With a total export target of 26 MMT for 2024/25, Canada still has 16 MMT available for the remainder of the season.
EU FALLS BEHIND AMID COMPETITIVE PRESSURES
The EU is out of the big game this season, struggling to remain competitive due to a sharp drop in production and intensified global competition. Soft wheat exports from the bloc totaled just 11.9 MMT from Jul to Nov, down from 15 MMT a year earlier.
The biggest losses were in the Middle East, where EU wheat struggled to compete with Black Sea origins in Egypt and Morocco. In Algeria, volumes remained stable, but diplomatic tensions between Algeria and France have excluded French wheat from state tenders, creating opportunities for Ukraine and Russia. Shipments to Asia, including Indonesia and South Korea, have also declined, with Ukraine and North America increasing their market presence.
The European Commission forecasts EU soft wheat exports at 25 MMT for 2024/25, down sharply from 32.7 MMT LY, leaving 13.1 MMT still available for export. However, Strategie Grains projects an even lower export total of 24 MMT, meaning the EU’s surplus may be even smaller. Despite the decline, Romania, one of the EU’s largest wheat exporters, still has sizable volumes available for the last half of the season.
UKRAINE STRENGTHENS POSITIONS IN ASIAN WHEAT MARKETS, BUT COMPETITION LOOMS
As we mentioned, Ukraine’s wheat exports this season have shifted significantly toward Asian markets, driven by the steady operation of the Ukrainian grain corridor. Key destinations, including Indonesia, Vietnam, Thailand, and Bangladesh, have increased their reliance on Ukrainian wheat, reshaping market shares in the region.
In Indonesia, Ukraine’s wheat market share surged to 33% between Jul and Nov 2024/25, a sharp increase from just 3% a year earlier. This expansion came at the expense of suppliers from Australia, the U.S., Russia, and Bulgaria. The USDA projects Indonesia’s wheat imports at 12 MMT for the season, slightly down from 13 MMT LY. With 4.5 MMT already imported by Nov, the country’s remaining demand stands at 8.5 MMT, presenting a sizable opportunity for exporters.
A similar trend is visible in Vietnam, where Ukraine’s share of wheat imports rose from 17% in the first half of last season to 48% this year, intensifying competition with Australian suppliers. The USDA expects Vietnam to import 5.3 MMT of wheat in 2024/25, slightly lower than the previous season. With 1.7 MMT already delivered by Nov, the country still needs 3.6 MMT to meet projected demand.
In Thailand, Ukraine has made remarkable gains, expanding its market share from 3% last season to 41% in 2024/25, displacing wheat from Australia, the U.S., Canada, and Bulgaria. The USDA estimates Thailand’s total imports at 3.6 MMT this season, an increase from 3.3 MMT last year. By the end of Nov, the country had already received 2.0 MMT, leaving 1.6 MMT of demand for the rest of the marketing year.
The most drastic shift has occurred in Bangladesh, where Ukraine’s market share has soared from 7% in Jul-Nov of 2023/24 to 55% this season. This growth has come at the expense of suppliers from the EU, Canada, and Australia. The USDA projects Bangladesh’s wheat imports at 6.9 MMT in 2024/25, a slight increase from LY. With 0.9 MMT imported by Nov, the country’s remaining demand stands at 6.0 MMT, making it another key destination for Ukrainian wheat.
These Asian markets still hold significant wheat import potential for the second half of the season. However, competition is set to intensify, with Australia’s larger harvest entering the market at more competitive prices, while the U.S., the EU and Canada expand their presence in the region. “Currently, Southeast Asia remains a non-competitive market for Ukrainian wheat, as buyers there are unwilling to pay prices comparable to those offered by European importers,” Dr. Lytvyn said.
Given these factors, Ukraine’s ability to maintain its dominance in these markets will be significantly challenged in the remainder of the 2024/25 season.
UKRAINE MAINTAINS EU MARKET LEADERSHIP, BUT DEMAND SHRINKS
The European Commission projects total soft wheat imports at 7 MMT for 2024/25, a sharp drop from 9.6 MMT last season. By the end of Nov, the EU had already imported 4.1 MMT, leaving a remaining demand of just 2.9 MMT — far lower than the 5.6 MMT recorded at the same point LY. This indicates a much tighter import window for the second half of the season, limiting opportunities for exporters.
Meanwhile, Ukraine continues to dominate wheat supply to the EU, holding 63% of the market share between Jul and Nov 2024/25, up from 61% a year ago, according to the European Commission. However, overall wheat demand in the EU is on the decline. Meanwhile, demand for feed wheat from Italy and Spain exists, but Ukraine cannot adequately meet it due to limited feed wheat availability in the second half of the season, according to Dr. Lytvyn.
Spain, the EU's key importer of Ukrainian wheat, has seen a surge in Ukrainian shipments this season, with Ukraine's share of overall wheat imports rising to 58% in the July-November period, up from 39% a year earlier. Spain primarily sources feed wheat from Ukraine, while milling wheat demand is largely met by European suppliers.
Manuel Alcaraz
General Manager of Garsan S.L.
"Spain is importing feed wheat from Ukraine, Bulgaria, and Northern Europe. This season, Ukrainian feed wheat is the most competitive in Spain, as crops in Romania and Bulgaria had better milling quality than Ukraine's and can be sold to other destinations," said Manuel Alcaraz, General Manager at a Spanish company Garsan S.L.
"Later in the season, consumption will depend on the price spread between wheat, corn, and soymeal. We expect to continue importing Ukrainian feed wheat as long as the corn-to-wheat spread remains around 4-5 USD/MT,” he added.
As for milling wheat, Alcaraz explained that Spanish millers are not accustomed to Ukrainian 11.5% protein milling wheat due to its high P/L ratio (tenacity/elasticity), which should be below 1. Instead, they prefer wheat with lower protein but a lower P/L ratio, such as French wheat, which they blend with high-quality wheat from Northern Europe.
Christina Serebriakova
CEO of ASAP Agri
Broker at Atria Brokers
“This season, the Spanish Mediterranean market was unwilling to pay competitive prices for Ukrainian 11.5% protein wheat handy parcels, opting instead to replace this grade with French wheat while sourcing high-protein milling wheat from the Baltics,” said Christina Serebriakova, CEO at ASAP Agria and Broker at Atria Brokers.
CHALLENGES IN EGYPT AND TURKEY WEIGH ON UKRAINE’S EXPORT OPPORTUNITIES
"Looking ahead to the second half of the season, we expect continued demand from Egypt and Tunisia. Moreover, shipments to Egypt could rise if Russia enforces its wheat export quota," said Dr. Lytvyn, assessing the demand prospects for Ukrainian wheat in the coming months.
Russia continues to dominate Egypt’s wheat market, posing a significant challenge for Ukrainian suppliers. Between Jul and Nov 2024, Russia’s share of Egypt’s imports jumped to 73%, up from 58% last season. In contrast, Ukraine’s market share dropped from 13% to 10%, while the EU also saw a decline. Russia’s aggressive pricing strategy remains a key advantage, making it difficult for other exporters to compete.
A major shift occurred in Dec 2024, when Egypt’s wheat procurement process changed. The newly established Mostakbal Misr for Sustainable Development took over responsibility for importing strategic commodities, a role previously managed by GASC. Following this transition, Mostakbal Misr purchased substantial volumes of Russian wheat and signed agreements with European suppliers, though the exact details remain unclear. This lack of transparency makes it difficult to assess how much of Egypt’s remaining wheat demand is still open for competition.
The USDA estimates Egypt’s total wheat imports at 12.5 MMT for the 2024/25 MY, with 6.7 MMT already purchased by Nov (as per data from the major exporting countries). This leaves a remaining demand of 5.8 MMT. However, given limited transparency around recent supply agreements, the exact volume still open to exporters remains highly uncertain.
In Turkey, Ukrainian wheat faces even greater challenges. Despite the relaxation of the wheat import ban on 3 Oct, 2024, demand from Turkish buyers remains weak. Ukrainian wheat’s share in the Turkish market has collapsed from 12% last season to just 3% this year, due to both government-imposed restrictions and fierce competition from Russian suppliers.
The USDA projects Turkey’s wheat imports at just 5.5 MMT in 2024/25, a steep decline from 9.4 MMT LY. By the end of Nov, the country had imported 1.4 MMT, leaving 4.1 MMT of remaining demand — a far smaller window for exporters than in previous years.
Thus, Ukraine’s exports to Egypt and Turkey in the second half of the season will largely depend on Russia’s export quota. Any revision to Russia’s quota could directly impact Ukraine’s export opportunities. However, continued market opacity in Egypt and restrictive state policies in Turkey make these markets increasingly difficult to navigate. Russia’s dominance and aggressive pricing strategies add further pressure, limiting Ukraine’s ability to expand in these markets.
In turn, Ukraine may have a chance to show itself on the markets of Algeria and Tunisia in the second half of the 2024/25 MY. So far this season the demand from these countries for Ukrainian wheat was much better compared to the previous one, with the importers shifting away from the EU origin. Algeria also increased purchases of Russian wheat. However, with Russia’s export quotas in place, Ukraine could find an opportunity to expand its presence in the North African market.
Based on export data from key suppliers, Algeria imported around 3.6 MMT of wheat between Jul and Nov of the 2024/25 MY. The country’s state grains agency, OAIC, has also booked about 2.3 MMT of both soft and durum wheat for delivery between Dec and Apr. With Algeria’s total wheat import potential for the season estimated at 9 MMT by the USDA, around 3.1 MMT remains open for procurement, creating room for additional Ukrainian shipments.
To sum up, where Ukrainian wheat can find demand in the coming months, ASAP Agri breaks down the key wheat importers into:
- Green light markets: North Africa — especially Egypt, Tunisia, and Algeria — where Russian export constraints may open doors wider, allowing Ukraine to expand its market share.
- Yellow light markets: The EU, particularly Spain and Italy. But limited Ukrainian feed wheat availability may restrict volumes available for export.
- Red light markets:
- Southeast Asia (Indonesia, Bangladesh, Thailand, Vietnam): Ukrainian wheat will be uncompetitive amid cheaper-priced Australian wheat.
- Turkey's restrictive import policies and Russia's market dominance are limiting demand for Ukrainian wheat imports this season.
*This material is the result of detailed research, structured and prepared by ASAP Agri experts, ensuring the accuracy and relevance of the information.
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