“With spring wheat we’ve been retreating from our recent rally in early March,” said Jim Peterson, marketing director with the North Dakota Wheat Commission, explaining that in early March there was a slight recovery from the February sell-off and prices were able to garner a 30- to 40-cent rally in futures.

“But now, as we’re approaching the end of March, we’re seeing somewhat of a sell-off and we’re probably down 20-25 cents, so we haven’t given up the full rally, but nonetheless it’s certainly frustrating to producers with old crop wheat left to sell,” he said.

“As dry as it is in a lot of areas going into spring planting, I think there was a hope that we’d catch a rally here before planting, either to pull out some old crop stocks or at least encourage some additional plantings,” he added.

As of March 24, local prices are still in that $5.30 to $5.80 range.

“One of the variables driving the market recently is still some uncertainty, but probably more pessimism in the grain markets with potential tariffs going (into effect) on April 2,” he said, adding that there’s a lot of debate right now among economists on whether the tariffs would be targeted tariffs, which seems to be indicated, rather than sector wide.

As of right now, prices are down about 60 cents from the mid-February high in the Minneapolis futures.

“It is highly likely not all key wheat buying countries will be targeted with tariffs. But right now, there’s not a lot of details and so there’s more speculation, and that just creates some uncertainty,” he said. “Even though we don’t have tariffs on Canadian spring wheat and durum currently because they’re part of the U.S.-Mexico-Canada free trade agreement, there is concern from end users that tariffs will go on April 2.”

Interestingly, Peterson noted that Canada already has retaliatory tariffs on U.S. wheat going north, even though the U.S. doesn’t have tariffs in place yet. Looking at the volume, he pointed out that there’s very little wheat that flows north compared to coming south.

“I think spring wheat, and durum (prices) especially, would benefit from tariffs on Canadian wheat just because it makes it such a high percent of annual U.S. mill grind,” he said.

But in the most recent USDA Supply and Demand Report that came out March 11, USDA actually raised projected imports coming in from Canada by 5 million bushels (MB) up to 75 MB. If realized, that would be the highest level since 2017.

“(It’s) kind of the opposite of what a lot of people anticipated would happen,” he said. “But I think what we’ve seen is a lot of front loading of Canadian wheat coming into the U.S. market to avoid the tariffs, and that’s mills buying and, unfortunately, even some rumors of our own U.S. grain companies importing a lot of Canadian wheat ahead of a potential tariff.

“I think that’s added a little bit of extra pressure to the spring wheat market nearby. One can only speculate like the market until we get a clearer picture of what might happen,” he added.

Another factor that’s impacting the market and could be viewed as a little bearish, according to Peterson, is that in that March 11 report, USDA raised world wheat production and lowered world wheat trade. World production was raised by 80 MB in Australia, 30 MB in Argentina, and 20 MB in Ukraine.

“All totaled, that’s about 40 percent of a North Dakota wheat crop, so a pretty notable increase. I think a lot of that was already factored in the market. Nonetheless, USDA confirming the bigger crops just adds a little bearishness,” he said, adding that USDA also raised beginning stocks in Turkey by close to 80 MB, so that also added to supplies.

As part of lowering trade estimates, USDA reduced potential imports into China, and if that holds, it would only be 50 percent of what China imported last year globally.

“Part of it is because China had a pretty good domestic crop and is trying to become a little more self-sufficient. But the bulk of their imports from here going forward in this current marketing year will likely be Canada or Australia or maybe some other non-U.S. origins because they do have a 15 percent tariff on U.S. wheat currently,” he explained.

“Ironically, global wheat prices are starting to stabilize, if not show a little bit of strength, and so hopefully that will trickle over to the U.S market,” he continued. “I think the big thing there is with Russia pulling back on exports. Their March exports were only 40-50 MB compared to last year when they were 185 MB in March, and the five-year average is 110 MB, so that’s helping to provide a little bit of strength.”

Another obvious variable is the development of the 2025 U.S. winter wheat crop. About 52 percent of the winter wheat crop in Kansas is rated good to excellent. But large parts of the western Winter Wheat Belt, from Oklahoma north into South Dakota, are facing some pretty dry conditions that have resulted in wildfires and dust storms with the winds they’ve had. Those areas are definitely going to need some moisture to stabilize crop prospects.

Meanwhile, the eastern part of the spring wheat region has been catching some snow and moisture recently, but for eastern Montana and western North Dakota, where it’s much drier, they’re going to need some pretty good spring moisture to get the crop off to a good start.

Looking at the March 31 Planting Intentions Report, a month ago the speculation was that spring wheat acres would be steady to slightly lower just based on prices. But since that time, Peterson said there’s been some indirect impacts that could actually lead to a slight increase in spring wheat acres.

China put a tariff on Canadian canola, as well as peas, so those market prices have “kind of tanked” although they’ve bounced back a little.

“But that’s impacted prices here in the U.S., too, so then wheat may garner some additional acres that were going to go to canola. But corn could also pick up some of those acres, especially in areas where growers had low protein or other quality issues with wheat in 2024,” he said.

Soybean acres, nationally, are projected to be lower. But, in visiting with producers, because it is a lower input crop, it may not be quite as sharp of a decline in this region.

“So, there are a lot of unknowns, but on March 31 we’ll get the initial estimate and that’s usually a report to react to. (And that) can change quite significantly depending on planting conditions and market trends in April and May,” he said.

With all that said, from a supply standpoint, the market will continue to shift focus to the 2025 crop and watch the growing conditions for winter wheat and planting conditions for spring wheat, according to Peterson. But demand is still a key near term variable, he added, and right now U.S. wheat exports, while doing better than a year ago, they’ve probably slipped a little the last couple months from where the U.S. needs to be to reach projections.

Currently, exports of all U.S. wheat stand at 768 MB, which is up 14 percent from a year ago but behind the USDA projection of an 18 percent increase. Hard red winter sales are at 192 MB, which is up 50 percent from a year ago but, again, slightly behind USDA’s projection. Spring wheat sales are 242 MB as of mid-March, which is up 6 percent from a year ago.

“But USDA is currently projecting sales will be 12 percent higher so, as we’ve been saying the last month or so, we need to be seeing an uptick in demand, especially with some of our big buyers in Asia – the Philippines and Japan,” he said. “We continue to do very well in Egypt, Nigeria, Italy and even Thailand, but we need to see some of our bigger exporters get going.

“And Mexico has been holding stable, but that’s one of the big variables with potential retaliatory tariffs that we’ll find out on April 2 and what develops there,” he continued. “Until then, there’s not a lot of clarity in the market, but probably a bit more volatility. Hopefully, we can gain some clarity and strike out in the upward direction with prices as we go into spring planting.”