Global wheat prices have declined by more than 40 per cent since the price peak in early March.
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The main drivers behind this easing have been supply coming to market from the northern hemisphere's winter crop harvest, along with market optimism over the Ukraine-Russia grain deal.
Despite the fall though, global wheat prices remain more than 50 per cent above the five-year average and are likely to remain near or above this level in the near future, not least because of an excessive level of optimism in the market about the Ukraine-Russia grain deal.
The United States Department of Agriculture estimates 2022/23 wheat production in key northern hemisphere origins - Europe, US, Canada, Ukraine and Russia - to be up 10.2 million tonnes year-on-year.
Production declines of more than 40pc in Ukraine and 4pc in Europe are expected to be outweighed by a 62pc rebound in Canadian production after last year's drought and a 17pc increase in Russia.
Notwithstanding this increase, strong demand is set to see stocks in key export origins ending 2022/23 down another 3 million tonnes year-on-year to the lowest levels since 2012/13.
The market certainly appears optimistic about the Ukraine-Russia grain deal and prices have declined accordingly, but it is hardly risk-free.
The deal was already thrown into question the day after being signed when a Russian missile struck the port of Odessa and again, more recently, with Putin questioning it and claiming Ukraine was primarily shipping grain to Europe rather than to low-income countries in need.
For now, the majority of ships which have left Ukrainian ports have been those stranded since the start of the war, while the new ships entering Ukrainian waters have reportedly been United Nations chartered vessels.
Privately-owned shipping companies, unsurprisingly, seem averse to sending their multi-million-dollar vessels into an active war zone.
An estimated 2 million tonnes of grain and oilseeds has reportedly been exported under the deal so far, with hopes to increase export flow to 33.5 million tonnes per month.
However, even if currently active ports are not disrupted, these volumes are expected to reach only half of the pre-war monthly levels.
Local Australian Premium White 1 Track/Free-In-Store wheat prices, on average, across port zones have also declined significantly since the May peak of $475/tonne to sub $400/t.
Despite global stocks remaining at multi-year lows, sustained upside for Australian wheat prices is expected to be limited between now and March 2023.
With shipping slots still busy exporting last year's Australian harvest, notable volumes of last year's crop still unsold on east coast farms and bulk-handling sites still brimming with grain on both coasts of Australia, there is expected to be limited impetus for higher local prices.
Temporary price opportunities may appear before mid-October, when local harvest ramps up, and after April 2023, when large volumes of domestic wheat are exported and before the northern hemisphere harvest in June/July.
Meanwhile, there is reason to believe that local feed wheat, and indeed the local feed grain complex, will once again trade at a considerable discount to APW1 at harvest.
On the west coast, a reduction in the use of nitrogen due to considerable dryness in June is likely to bring down average protein levels, while on the east coast, a wet finish is expected to weigh on average wheat quality at harvest.
