US wheat farmers are facing significant challenges with declining crop yields due to adverse weather conditions, despite a surge in global wheat prices. The USDA's June 11 Crop Production report forecasted a 27% decrease in 2026 US winter wheat production to 1.030 billion bushels, down from 1.402 billion bushels in 2025. This includes an estimated 38% drop in hard red winter wheat production to 496.886 million bushels, potentially the lowest since the late 1950s, and a 15% decrease in soft red winter wheat production to 300.252 million bushels, which would be the lowest since 2020.
These concerns are exacerbated by a lack of precipitation in key hard red winter production states like Oklahoma, Texas, Colorado, Nebraska, and Kansas, where a spring freeze also damaged crops. For example, good-to-excellent conditions in Kansas dropped from 62% in late November to 38% by April 5. The total winter wheat acreage also declined, with hard red winter wheat falling approximately 700,000 acres and soft red winter wheat down about 250,000 acres from March estimates.
The shrinking US wheat crop means exceptionally tight stocks, pushing prices upwards. US wheat future prices have risen, with September CBOT Wheat closing at $7.05 3/4 and KCBT Wheat at $7.63 1/4. However, economist Dan Basse of AgResource Co. noted that the US may not be able to capitalize on export opportunities, as prices need to remain non-competitive to conserve domestic supplies due to the low production.
Globally, wheat supplies are also tight, with the USDA's July 10 WASDE report projecting 2026-27 global wheat ending stocks at 272.84 million tonnes, down 2.2% from 2025-26. This situation is worsened by escalating risks in the Black Sea region, where Ukrainian attacks on Russian ports have led to the closure of the Kerch Strait, a key export route for nearly one-third of Russia's wheat. Europe is also facing potentially its steepest decline in grain production in decades due to extreme heat and geopolitical tensions, with corn crops expected to be the smallest in 19 years, further fueling global price increases.
