Wheat Price Forecast: Different Scenarios for the Market in 2022-2030

Will the price of wheat continue going up? Learn this from the wheat forecast for 2022 and beyond.

Wheat Market Size and Consumption by Sectors

Wheat is one of the most cultivated crops and the most consumed one globally. In 2020, the global wheat consumption was 739 million metric tonnes; the market size is projected to have a CAGR of 4.5% at least until 2027.

Feed and food account for the largest share of the global wheat market. The industrial application (pharmaceutical, dietary supplements, cosmetics & personal care, transport) is much smaller.

The largest wheat producers in the world are China, India and Russia, responsible for about 41% of the total volume of production. The chart below shows that the EU and Russia have a bigger surplus in supply.

Most Important Drivers of Wheat Prices

The balance of supply and demand is impacted by two sets of factors, the most influential of which we'll cover in the lists below. 

Supply-side factors: 

• Geopolitical events (logistical disruptions, sanctions)
• Government intervention (programmes, reforms, farm subsidies) 
• Energy prices (operating costs, fertilisers)
• Climate and weather 
• Land productivity

Demand-side factors: 

• Value of USD
• Rate of population growth
• Income growth
• Feed substitution 
• Speculation

Wheat Price Forecast for 2022 and Expert Outlooks

Agriculture and Horticulture Development Board warns about the disrupted global supplies, particularly from major exporting countries - Russia and Ukraine. The Board consensus is bullish in the short term. A lot will depend on how long the war between the two countries lasts.

Farmers Weekly reports that exceptionally high feed wheat prices drive consumers to alternatives. Considering the narrowing gap between feed barley and feed wheat, the price curve of the latter may flatten. This assumption is supported by the fact that markets have already tempered slightly from the record highs of early March. Still, prices will remain volatile and exceptionally reactive to external factors.

Frontier Agriculture shares estimations that production levels will be cut in half (down to 14.9 milliontonnes). Despite optimistic export forecasts, closed ports and damage from the war may put additional pressure on prices. A railway solution may ease the situation.

Wallet Investor expects wheat to hit above $1,114 by the end of 2022.

According to Gov Capital, wheat might cross $1,253 at peak times and finish the year with $1,082 on average.

Technical Analysis of Wheat Prices

To estimate the timing and magnitude of wheat price changes, we'll be using technical analysis and summary provided by Investing.com on a monthly timeframe:

Since indicators and MAs suggest a strong bullish movement, it's useful to look closer at their values and suggested action.

Wheat Price Forecast for 2023

Wallet Investor forecasts the commodity to slightly increase in value through 2023, closing the year at $1,229.

With Gov Capital, the forecasted prices are higher. The average price of wheat to trade at around $1,345 at the end of 2023.

Wheat Price Forecast for 2024

Similar to its wheat price predictions for the previous year, Wallet Investor sees a slight uptrend for 2024.

Gov Capital anticipates a significant jump in March-April 2024 (from $1,436.73 to $1,679.44). The average price in December might be $1,679.72.

Long-Term Wheat Price Forecast for 2025-2030 

According to Wallet Investor's data for 2025, wheat will finish 2025 with a trading price of $1,462.41.

The last detailed forecast comes from Gov Capital. The source predicts the commodity to cross the average mark of $2,000 in April 2025 and continue the gradual uptrend until the end of the year.

Analysts don't have detailed forecasts for 2030 because long-range forecasting can only be approximate. However, some sources speculate in which direction the price of commodities will move. OECD-FAO (the Organisation for Economic Co-operation Development and the Food and Agriculture Organisation of the United Nations) expects wheat prices to increase due to average harvest expectations and moderate growth in exports and food use.

Price Dynamics of Wheat Over the Years

The last time the wheat price chart featured an exceptionally sharp surge was in 2008 - the recession drove the price to $1,191.50 (10 March). See the chart for the swings in wheat prices since then.

Takeaway (+A Few Words About Agriculture Stocks)

The wheat price predictions presented in this article are overwhelmingly bullish. So far, we haven't seen any major publications that share bearish expectations, except for those that expect a less sharp price graph in the future. The patterns we see in 2022 are reminiscent of those in 2007-2008. However, commodity prices can be driven by unexpected movements in global activity.

As for agriculture stocks, a few are worth mentioning: 

• Bunge Ltd. (NYSE: BG) - Overweight
• Adecoagro S.A. (NYSE: AGRO) - Overweight
• Mosaic Co. (NYSE: MOS) - Overweight

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Disclaimer: The content of this article should not be considered investing/trading advice. Forecasts presented were taken from third-party sources and are based on past performance, which does not guarantee future results.