Argentina Cuts Export Taxes, Floods Wheat Market, And Forces Europe To Discount

Key Points

• Argentina’s biggest wheat harvest on record is pushing global prices down at a sensitive moment.
• Europe has surplus wheat, but it is losing tenders where a $10–$20 price gap decides winners.
• Morocco, a cornerstone buyer for France, is now taking Argentine cargoes as Europe’s window narrows.

The story looks like a simple price war. The deeper story is about timing, policy signals, and who can move grain fast.

Argentina is coming off a wheat harvest tracked around 27.7–27.8 million tonnes, a new national record. That extra supply lands in global markets right when many importers rebuild stocks.

It also arrives with a policy nudge. Argentina lowered export taxes on wheat and barley from 9.5% to 7.5%. In commodity trade, small tax cuts can decide entire tenders.

That is why Europe’s surplus is not translating into easy sales. Western Europe is typically a higher-cost origin. When Argentina offers wheat near $212–$215 a tonne FOB for February shipment, it sets a tough benchmark.

Recent comparisons have shown gaps that leave French or Romanian wheat roughly $16–$18 per tonne higher. Earlier in the season, Argentine “Up River” wheat was near $207 versus about $228 for French wheat at Rouen.

Buyers do not need to love Argentina. They only need a cheaper landed cost. Morocco is where the shift becomes visible. France has already shipped about 1.63 million tonnes of soft wheat there this season.

But the first Argentine wheat vessel has also reached Moroccan ports. That matters because Morocco has become even more important for EU exporters after Algeria shifted much of its sourcing toward Black Sea origins.

Tenders are reinforcing the new order. Traders reported Algeria buying roughly 600,000 tonnes, with Argentina expected to be a major supplier. Egypt remains another battleground.

Freight risk tied to the war in Ukraine can complicate Black Sea flows, but price still dominates decisions. Europe’s own constraints add friction.

Many farmers have resisted selling at the lowest prices in five years. That tightens nearby availability and makes exporters less flexible. Forecasters are responding.

Expana cut its 2025/26 EU soft wheat export outlook by 4% to 28.8 million tonnes. EU tracking showed soft wheat exports around 11.8 million tonnes by January 15, with reporting lags.

The clock is also running. Morocco’s domestic harvest starts around May, usually reducing import demand. If Europe wants large new sales before summer, prices may need to fall again.

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