Global Wheat Outlook Stable for 2026, But Iran War Clouds Input Costs and Sowing Decisions

Global wheat production prospects for 2026 remain broadly favourable, even as escalating Iran war raises concerns over rising input costs and planting uncertainty, according to the latest assessment by the Food and Agriculture Organization (FAO). With most of the 2026 wheat crop already sown and harvests approaching in several regions, FAO has kept its global production forecast largely unchanged at 820 million tonnes. While this marks a 1.7 percent decline from the previous year, output is still expected to remain above the five-year average, indicating a relatively comfortable supply situation.

However, the intensifying conflict has introduced fresh risks to the outlook. Higher energy prices are pushing up fertilizer and transportation costs, while supply chain disruptions are adding further uncertainty. These pressures are particularly significant for spring wheat crops in the northern hemisphere and yet-to-be-planted crops in southern hemisphere countries.

Tightening profit margins, driven by rising input costs and relatively flat crop prices, may also influence farmers’ planting decisions, especially for maize. Producers could shift towards less fertilizer-intensive crops, although the scale of such changes remains uncertain.

Record wheat harvest expected in India

Regionally, production trends vary. India stands out with prospects of a record wheat harvest of 120 million tonnes, supported by higher sowings, favourable early weather, and adequate irrigation. Production in Pakistan and China is also expected to slightly exceed historical averages.

In the European Union, wheat output is projected at around 137 million tonnes, slightly lower due to reduced winter sowings and a return to average yields after last year’s highs. In contrast, favourable weather conditions in the United Kingdom are expected to lift production above 13 million tonnes.

In the Russian Federation, lower planting areas are likely to result in a smaller harvest despite generally conducive weather. Ukraine’s wheat production is forecast at 23 million tonnes, stable year-on-year but still significantly below pre-war levels. In the United States, reduced sowings and drought concerns are expected to bring production down to about 51 million tonnes, though still above the five-year average.

Elsewhere, improved rainfall in Iran and strong winter moisture conditions in Türkiye are supporting favourable crop prospects, while North Africa is set for a production rebound after two years of drought.

Maize: Brazil expects above average crop

For maize, harvesting is underway in southern hemisphere countries. Brazil is expected to produce an above-average crop, supported by favourable weather and strong export demand, though output may fall short of last year’s record. Argentina and South Africa are also projected to harvest above-average crops.

FAO raises global cereal production forecast

On the broader cereals front, FAO has raised its 2025 global production forecast to 3,036 million tonnes, up 5.8 percent year-on-year. Global rice production is expected to hit a record 563.3 million tonnes in 2025-26, driven by major producers including India, China, and Indonesia.

Global cereal utilization is forecast at 2,945 million tonnes, while stocks are projected to reach a record 951.5 million tonnes, pushing the stocks-to-use ratio to a comfortable 32.2 percent. Meanwhile, global cereal trade is estimated at 505.3 million tonnes, reflecting strong demand and steady export flows.

Despite an overall positive supply outlook, FAO cautions that rising input costs linked to geopolitical tensions could weigh on future production decisions and market stability.