After the US government announced new tariffs against Canada, Mexico and China, these countries took retaliatory measures that also affect the wheat trade. China imposed an additional 15% duty on US wheat, Canada and Mexico are considering or have already announced retaliatory tariffs on US products.
Grain production in the European Union and the United Kingdom has been revised down sharply in COCERAL’s latest forecast as adverse weather conditions weigh on harvests.
In May 2024, global wheat export prices rose sharply in all major producing countries, with many recording double-digit growth. Increasing concerns about the impact of unfavorable crop conditions on the 2024 harvest in the European Union and the Russian Federation led to a 16 percent increase in prices in the EU and a 12 percent increase in the Russian Federation.
Previous administrations resisted raising prices for fear of civil unrest. But because of a falling currency and rising prices for wheat imports, government officials recently made the unpopular decision to raise the cost of a loaf of bread from 4 piastres to 20. The increase amounts to about a quarter of a cent in U.S. currency.
Due to unprecedentedly low water levels on Lake Gatun, the Panama Canal Authority is limiting the number of daily vessel trips to a minimum of 18 vessels per day by February 2024.
Water levels in Lake Gatun, which is the canal's source of water, are currently 7% below the October average of the previous five years.