Kateryna Mudriian
Chief Analyst at ASAP Agri

Inna Stepanenko
Chief Analyst at ASAP Agri

The 2025/26 wheat season has opened in clear surplus mode, with global production projected at 837.8 MMT (+37 MMT y/y) and ending stocks rising to 274.9 MMT, keeping buyers comfortable and rallies hard to sustain. With bigger crops across the Black Sea, France, Canada, Argentina and Australia, exporters face a crowded, price-competitive arena where execution and margin discipline matter as much as supply. Into H2, competition is set to intensify as Russia’s larger quota window meets fresh Southern Hemisphere availability, leaving limited upside unless weather or logistics meaningfully tighten the channel.

TOO MUCH WHEAT: 2025/26 SURPLUS SEASON

The 2025/26 wheat season opened with bins already full. Global production is estimated by the USDA in December at 837.8 MMT, up 37 MMT y/y, setting a clear surplus-first tone from the very start. This expansion is broad-based. The Black Sea is part of a wider wave of increased supply, with regional production forecast at 136.5 MMT, up 10.3 MMT y/y, following last season’s weather-hit output. The largest gains come from Russia (+7.2 MMT) and Romania (+2.8 MMT), adding volume to an already competitive export arena. Meanwhile, Ukraine harvested 22.9 MMT of wheat this season, slightly above last year’s 22.5 MMT. 

Supply growth extends well beyond the Black Sea. Several other major exporters are also bringing larger crops to market, including France (+7.6 MMT y/y), Canada (+4 MMT), Argentina (+9.2 MMT), and Australia (+1.5 MMT). In practical terms, more origins have more wheat to sell at the same time, turning the market into a crowded departure board with limited scope for sustained price rallies.

Global trade dynamics reflect this oversupplied environment. In 2025/26, wheat trade looks less like a sprint and more like a crowded relay race. The Black Sea remains the largest export hub, but no longer operates at peak intensity. Despite a larger regional crop, Black Sea wheat exports are forecast at 71.3 MMT, only marginally above 71.1 MMT in 2024/25 and well below the 2023 peak of 87.3 MMT.

The moderation is largely driven by Russia’s slower export pace. After exporting 55.5 MMT in 2023, Russian shipments fell to 43.0 MMT in 2024/25 and are projected at 44.6 MMT in 2025/26. Ukraine’s exports also trend lower, forecast at 14.3 MMT, down from 15.8 MMT last season and 18.6 MMT in 2023. Elsewhere in the region, volumes add stability rather than momentum: Romania rebounds to 6.9 MMT, Bulgaria edges slightly lower to 3.9 MMT, while Serbia and Moldova remain small but steady at 1.4 MMT and 1 MMT, respectively. 

With the Black Sea no longer flooding the market at 2023 levels, rival exporters gain room to compete. Canada remains a heavyweight at 28.0 MMT, Australia is set to lift shipments to 27.0 MMT, and the U.S. improves to 24.5 MMT. Argentina strengthens to 14.5 MMT, while France, after a weak 2024/25 season, is expected to recover exports to 7.5 MMT, marking a clear return to the global export map.

Inventories add another layer of pressure. Global wheat ending stocks are projected at 274.9 MMT in 2025/26, up 14.8 MMT y/y, providing a comfortable buffer for buyers and reducing urgency on the demand side. Against this backdrop, wheat FOB prices across major exporting origins have generally drifted lower since mid-summer, with rebounds proving short-lived as abundant supply and rising carry-over stocks cap the upside.

FROM OPEN GATES TO TIGHT CHANNELS: UKRAINIAN WHEAT EXPORTS IN H1 2025/26

The July–December period of the 2025/26 season marked a clear slowdown in Ukrainian wheat exports. Shipments totaled 7.86 MMT, trailing 9.86 MMT a year earlier, as the market shifted from a familiar, EU-led flow to a far more competitive and logistically constrained environment. Delayed harvesting, surplus-driven global pressure, the return of EU quotas, and repeated disruptions to ports and logistics combined to compress Ukraine’s export window and force a rapid reorientation of trade flows.

TIGHTER EU ACCESS HIT UKRAINIAN WHEAT EXPORTS HARD

In 2025, the EU moved Ukrainian grain trade from open access back to a quota-based regime. Annual grain tariff quotas were reinstated from 6 June 2025, including 1 MMT for wheat, and were later expanded to 1.3 MMT from late October. Wheat was hit the hardest: once EU access tightened, a flow that had operated almost automatically was forced to reroute. 

The impact is clear in shipment data. In July–December 2025/26, Ukraine exported just 507 KMT of wheat to the EU — about 6% of total exports — down sharply from 3.37 MMT, or 34%, a year earlier. Spain remained Ukraine’s largest EU buyer, but volumes collapsed sharply — from roughly 2.3 MMT in Jul–Dec 2024/25 to about 276 KMT in Jul–Dec 2025/26. Italy retained second place, yet its intake also shrank materially, falling from around 400 KMT to approximately 157 KMT.

SHIFTS IN UKRAINIAN WHEAT DESTINATIONS: NORTH AFRICA TAKES THE LEAD 

As EU access tightened, North Africa emerged as the main absorber of Ukrainian wheat in the first six months of 2025/26. In July–December 2025/26, shipments to North Africa reached 3.56 MMT, accounting for 45% of Ukraine’s total wheat exports over the period, up sharply from 2.15 MMT (22%) a year earlier.

This surge partially offset the collapse in EU demand and became the key buffer for Ukrainian wheat exports in the first half of the season, rather than a full replacement. Egypt led the shift, nearly tripling imports to around 2.03 MMT from 800 KMT a year earlier, while Algeria increased purchases to 1.2 MMT from 740 KMT. 

Other regions played a secondary role in absorbing Ukrainian wheat. The Middle East expanded but remained smaller in scale, with imports rising to 1.3 MMT (18%). The increase was broad-based, led by Yemen, where shipments climbed to 540 KMT from 290 KMT a year earlier.

By contrast, Southeast Asia softened to 2.2 MMT (28%), pressured by intense competition from Australia and ample global supply. Several key markets reduced purchases: Vietnam slipped to 520 KMT from 820 KMT, Thailand fell to 170 KMT from 640 KMT, and Tunisia declined to 250 KMT from 450 KMT. Indonesia remained a major outlet, though volumes edged lower to 1.4 MMT, compared with 1.55 MMT a year earlier.

PORTS UNDER ATTACK: KEY PRESSURE ON UKRAINIAN WHEAT EXPORTS IN LATE 2025

One of the major factors pressuring Ukrainian wheat exports in the second half of 2025 was the escalation of Russian attacks on logistics and energy infrastructure. Repeated strikes on ports, railway networks, and power supply facilities — including terminals, storage sites, access roads, rail junctions, substations, and adjacent industrial assets — disrupted loading schedules at Ukraine’s key Greater Odesa ports (Odesa, Chornomorsk, and Pivdennyi), forced temporary shutdowns, and increased safety-related delays across the export chain.

Even when operations resumed quickly, the impact lingered. Higher insurance and risk premiums, tighter vessel availability, rail congestion, and more cautious execution by shippers and buyers continued to weigh on export performance. For the market, this translated into a less predictable export flow: shipment windows became harder to guarantee, freight, handling, and rail costs rose, and some volumes were diverted to alternative routes — including truck and rail shipments to the EU or re-routing within the Black Sea — typically at a higher total logistics cost.

In a surplus global wheat market, these disruptions did not provide price support. Instead, they compressed exporter margins, as Ukrainian offers had to absorb higher risk and logistics costs while remaining competitive against plentiful alternative supplies.

H2 2025/26: WHAT COMES NEXT?

The key question now is whether Ukraine can keep wheat exports moving in the second half of the season. The setup is demanding, shaped by two powerful headwinds. First, global competition intensifies as Southern Hemisphere supplies ramp up and Russia enters H2 with a broader export quota framework. Second, operational risk remains elevated at Ukrainian deep-sea ports, where ongoing Russian attacks are likely to persist at least through the end of winter, continuing to disrupt flows and execution.

Ukraine exported 7.9 MMT of wheat in July–December. Against the December WASDE export forecast of 14.5 MMT, this leaves roughly 6.6 MMT still to be shipped in the second half of 2025/26. In other words, around 45.5% of the season’s export potential remains unshipped — well above 37% at the same point last year.

With ample global supply, persistent port disruptions, and limited willingness among Ukrainian sellers to further cut prices, the second-half export window looks narrow. Execution, rather than demand alone, is likely to be the decisive factor.

BIGGER RUSSIAN EXPORT QUOTA TO INTENSIFY COMPETITION 

Russia is poised to reassert pressure on global wheat markets in the second half of 2025/26. The USDA estimates Russian wheat exports at 44 MMT in 2025/26, slightly above 43 MMT last season and broadly in line with local analysts’ assessments (44.1–44.6 MMT).

According to industry estimates, Russian wheat exports reached about 25.5 MMT in July–December, down from 29.1 MMT a year earlier. As a result, roughly 18.5 MMT of exportable surplus remains for the rest of the season. After a slow start, a larger share of volumes is now shifting into the later months.

The key change lies in policy. Russia’s government has set a 20 MMT export quota for 15 February–30 June 2026, covering wheat, corn, and barley. This is almost double last season’s 10.6 MMT quota, which applied to wheat only, significantly widening the scope for heavier shipments in H2.

After a muted export pace early in the season, Russian wheat presence across several MENA markets softened in July–October, but competition remained intense — particularly in Egypt. Turkey continued to rely heavily on Russian supply, with shipments to the country increasing so far this season. Taken together, the expanded quota framework points to stronger Russian export pressure in the months ahead, directly challenging Ukraine’s position in key destination markets.

SOUTHERN HEMISPHERE SUPPLY ADDS PRESSURE

Southern Hemisphere suppliers are adding to the burden in the second half of the season, with both Australia and Argentina positioned to lift wheat exports on the back of stronger production.

Australia is projected to export 27 MMT of wheat in 2025/26, up from 23.7 MMT a year earlier. With harvest running from October to February, the bulk of the Australian supply is still entering the market, intensifying competition precisely in the second half of the season.

In July–October, Australia significantly increased shipments to Southeast Asia, including key Ukrainian destination markets such as Indonesia, Vietnam, Bangladesh, and Thailand, with some improvement also recorded in China.

Argentina is also expanding its export footprint. The USDA forecasts wheat exports at 14.5 MMT, up from 13 MMT last season. This estimate is based on a 24 MMT crop, while local analysts see significantly higher output — 27.1 MMT (Buenos Aires Grain Exchange) and 27.7 MMT (Rosario Grain Exchange) — suggesting additional export upside. Supporting this, Argentina’s government cut wheat export taxes from 9.5% to 7.5%, further improving competitiveness.

Trade flows already reflect this shift. Argentina exported nearly 600 KMT of wheat to Indonesia in September–November, compared with virtually no shipments over the same period a year earlier, highlighting its growing presence in markets traditionally important for Ukraine.

That said, reports of lower protein content in Argentina’s wheat crop may limit its penetration into premium milling segments, while intensifying competition in the feed wheat market instead.

EU RETURNS TO THE BIG GAME — BUT NOT FOR UKRAINIAN WHEAT

After a weak production year in 2024/25, the EU harvested a significantly larger wheat crop this season, restoring export potential. The European Commission estimates EU soft wheat exports at 31 MMT in 2025/26, up from 25.5 MMT last year.

So far, however, execution has lagged ambition. In July–October, EU soft wheat exports reached 10.2 MMT, only marginally higher than 9.9 MMT a year earlier. This leaves roughly 20.8 MMT still to be placed between November and June, setting the stage for heavier EU selling later in the season and adding another layer of competitive pressure to the global market.

In terms of destinations, Egypt remains a difficult outlet for the EU amid strong Black Sea competition. Instead, EU shipments have been more active into Morocco, Tunisia, Jordan, and Saudi Arabia. By contrast, the EU’s presence in Southeast Asia has eased, with lower exports to Indonesia, Bangladesh, and Thailand, and only a modest increase in shipments to Vietnam.

Manuel Alcaraz

For Ukrainian wheat, prospects for the second half of 2025/26 look no better than in the first half. As Manuel Alcaraz, General Manager at CYH Garsan S.L., notes: “This season, EU demand is being filled mainly with French and Baltic wheat. Because EU exports are not competitive in third countries, volumes have to find a home within the EU. Thus, the Ukrainian quota for 2026 will most likely be used for the new 2026/27 crop — not earlier.”

This suggests that EU access is unlikely to provide meaningful relief for Ukrainian wheat exports in the remainder of the 2025/26 season, keeping pressure firmly on alternative destinations.

U.S. STAYS STRONG, WHILE CANADA MAY EASE EXPORTS

The U.S. remains a firm presence in the global wheat market. Export potential for the 2025/26 marketing year is estimated at 24.5 MMT, up from 22.5 MMT a year earlier, supported by higher production and larger carry-in stocks from 2024/25.

Early-season performance has been solid. In July–December U.S. wheat exports remained strong, extending beyond traditional outlets in North and Central America. Shipments to Southeast Asia increased notably, intensifying competition in the region, with higher volumes reported to Indonesia, Bangladesh, and Vietnam.

Canada, by contrast, may slightly scale back exports. Despite a larger crop, wheat shipments are projected at 28 MMT, down from 29.3 MMT last season, as higher domestic consumption and larger ending stocks limit exportable surplus.

That said, Canada’s July–December export pace has been robust so far. Shipments increased to Spain, once a major destination for Ukrainian wheat, but now reducing purchases under the EU import quota regime. Canadian supplies also rose to China and Bangladesh, while exports to other Southeast Asian markets showed some softening.

Thus, the second half of the 2025/26 season is shaping up to be particularly challenging for Ukrainian wheat exports. Historically, the first six months of the marketing year account for around 65% of total annual shipments. Based on the 2025/26 export forecast of 14.5 MMT, this implies that roughly 9.4 MMT should have been exported by January 2026. Instead, actual shipments fell short by around 1.6 MMT — a meaningful gap already built into the season’s balance.

Victoria Blazhko

As Victoria Blazhko, Head of Editorial, Content and Analytics at ASAP Agri, notes: “Closing this gap quickly will be difficult. Winter logistics are unlikely to improve meaningfully; the global market is oversupplied, and EU quotas and large local supply continue to restrict access for Ukrainian wheat. Meanwhile, Argentina and Australia are entering the global market with record crops, drawing away key demand.”

Against this backdrop, the risk of higher carry-over stocks is rising. Ukraine’s wheat ending stocks in 2025/26 could increase to nearly 2.5 MMT, the highest level since 2022/23. Even this estimate may prove conservative if the 1.5 MMT export gap built up in the first half of the season is not offset in the months ahead.

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