Wheat

Wheat updates

Harvest progresses as wheat prices trend higher.

Wheat markets moved sharply higher during July as tightening U.S. production forecasts and escalating geopolitical tensions in the Black Sea region raised concerns. Chicago wheat futures climbed from a late-June low near $5.68/bu to recent highs approaching $7.10/bu, driven initially by lower U.S. acreage and yield expectations. Additional support came from renewed conflict between Russia and Ukraine, which has increased uncertainty around grain exports from the Black Sea. Russia and Ukraine are expected to account for nearly 30% of global wheat exports this marketing year, making disruptions to export infrastructure or shipping routes a key concern for world wheat supplies.

Pacific Northwest wheat harvest continues to advance, with early reports indicating generally favorable yields and quality despite localized weather challenges. More than 20% of the region's exportable wheat crop has been harvested, while much of the wheat destined for Gulf export channels has already been cut. Hard red winter wheat harvest is progressing steadily, and producers are reporting better-than-expected grain quality despite drought in parts of the production region. However, additional acreage abandonment is expected to be reflected in future estimates, and if realized, the hard red winter crop would be the smallest since 1957.

Soft white wheat harvest is also gaining momentum, particularly in lower-elevation and drier production areas, with winter wheat harvest estimated at approximately 18% complete. Meanwhile, the spring wheat crop has fully headed and is developing well, with harvest expected to ramp up in the coming weeks. USDA crop condition ratings improved recently, with winter wheat rated 66% good-to-excellent and spring wheat rated 61% good-to-excellent.

Across Washington, early yield reports have ranged from 80 to 100 bushels per acre, although some fields have experienced localized yield losses from freeze damage and drought stress. Oregon producers are reporting above-average yields, underscoring the importance of timely rainfall during key growth stages rather than total seasonal precipitation. Protein levels are expected to vary considerably across the region, with lower protein levels generally associated with stronger-than-expected yields. In Idaho, growers continue to evaluate the impact of spring freezes on grain quality and grain fill, while isolated hail events in northern areas may have caused localized crop damage.

Montana's durum wheat crop remains on track, supported by favorable subsoil moisture conditions. Approximately 70% of the crop has headed, and 2% has begun turning color. Recent hot, dry weather has accelerated maturity, with the first harvest activity expected within the next two weeks. While surface moisture conditions have deteriorated in some areas, precipitation received during June and early July has helped sustain crop development. USDA currently rates 57% of Montana's durum crop as good-to-excellent as producers monitor final grain fill and harvest prospects.

Profitability

Persistent margin pressure continues to weigh on wheat producers, as low prices and elevated input costs limit profitability, though tighter supplies and drought-driven yield risks may provide some price support in the months ahead.