It is always fashionable to talk about the US, as the reigning superpower, losing its grip on world.

Forecasts of the dollar being superceded by, say, the euro or the renminbi as the world's reserve currency, talk which resurfaced this week in the context of the oil market, has been around for years. And wrong for years.

But in one area, America's global hold is most definitely weakening. And that is over wheat.

Flagging demand 

If forecasts from the US Department of Agriculture in its latest global crop supply and demand report prove correct, the country's exports will dip to 24.5m tonnes in 2009-10.

Sure, that's not unprecedented. Shipments were lower, for instance, in 2002-03.

But this year's dip looks more significant. It is down to a dearth of demand, which is not in America's control, rather than supply, which is.

The slump seven years ago was caused by a dismal harvest. Only three quarters of American wheat-sown areas were harvested. And those fields that did host a combine returned poor yields.

Shrinking player 

What's more, this decline is not just a one-off. It reflects a long-term shift in the market's dynamics.

The proportion of wheat America provides to the world market is poised this year to drop below 20% for the first time in, well, ages.

Five years ago, US growers contributed 26%. Twenty five years ago, the figure was 34%.

US wheat is just not the catch it once was. The former Soviet countries, in particular, are raising their game, giving America far stronger competition.

Insurance mechanism

But that may not be quite the worry it first seems.

Wheat's loss has, to some extent, been corn and soybean's gain. And in these crops, the country still holds sway, being responsible for nearly of world soybean exports, and nearly two-thirds of corn.

That gives Farm America far better inbuilt insurance. If US wheat wilts, importers can usually go to Australia or Ukraine instead.

If its corn flags, or soybean suffers, buyers have little choice but to wave bigger cheques.

Losing its hold on wheat may hurt America. But losing its grip on corn or soybeans would be a bigger strategic and financial blow.