This report evaluates the U.S. and world wheat markets for the 2002-2012 period using the Global Wheat Policy Simulation Model. This analysis is based on a series of assumptions about general economic conditions, agricultural policies, weather conditions, and technological change. Both the U.S. and world wheat economies are predicted to improve for the next ten years. World demands for both common and durum wheat are expected to grow faster than world production resulting in gradual increases in prices of the wheat varieties. However, the higher price levels experienced in 2002 due to weather conditions will not be maintained in the short term. World trade volumes of both classes of wheat are expected to expand, but trade volume of durum wheat may grow faster than common wheat.