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Paris wheat hits six-week high, then falls back

Paris wheat hits six-week high, then falls back

HAMBURG: Paris wheat futures fell on Tuesday in the face of technical resistance after earlier hitting a six-week high, with weak near-term export demand for EU wheat capping prices.

December milling wheat on the Paris-based Euronext exchange was down 1.0 euro, or 0.4 percent, at 203.50 euros ($235.88) a tonne at 1556 GMT.

Earlier on Tuesday the contract rose to 205.50 euros, its highest since Sept. 3, but again failed to break clear of its recent trading range.

“There isn’t any good reason to test the top of the current range,” one futures dealer said. “We’re still not seeing any revival in export demand.”

Euronext prices also faced pressure from export-punishing strength of the euro against the dollar, although a slight rise for Chicago wheat lent some support.

Forecasts of lower global wheat supplies after a series of weather-damaged harvests worldwide, together with dry conditions for wheat sowing in western Europe, continued to underpin the market.

But near-term export activity at French ports remained light, even though traders expects exports to pick up later in the season as supplies in top exporter Russia ebb.

In Germany, cash premiums in Hamburg were little changed in weak demand.

Standard bread wheat with 12 percent protein for October delivery in Hamburg was offered for sale unchanged at 2.0 euros over Paris December.

“The market lacks energy with German port export loadings remaining at modest levels and high feed wheat prices the main supportive factor,” one German trader said.

Feed wheat in Germany’s South Oldenburg market for October/December delivery was offered for sale well over milling wheat, at around 215 euros a tonne, with buyers seeking 213 euros.

“High costs for road and inland waterways transport make it difficult to sell wheat from South Germany into the north German animal feed markets,” another trader said. “North German feed makers prefer to purchase from east Europe and take delivery by seagoing ships or railway.”

Copyright Reuters, 2018

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