EU wheat slips with Chicago as export lull continues

PARIS: European wheat futures fell on Wednesday to their lowest in almost two weeks, pressured by weakness in Chicago and a dearth of short-term export demand.

December milling wheat on Paris-based Euronext was down 1.25 euros, or 0.6 percent, at 202.00 euros ($232.95) a tonne, close to a 201.75 euro session low that marked its weakest level since Oct. 4.

The contract was testing the bottom end of its recent range, having run up against chart resistance on Tuesday when it touched a six-week high of 205.50 euros.

Chicago wheat, the global benchmark, was down about 1 percent in U.S. trading, encouraging Euronext to ease, though a weaker euro lent some support to Paris prices.

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 and keep it above the psychological 200 euro threshold.

Analysts notably expect ebbing supplies of Russian wheat to boost demand for western European and U.S. wheat as the 2018/19 season progresses.

However, current export activity at French ports remained thin, curbing Euronext prices.

On the import side, a vessel carrying 25,000 tonnes of Bulgarian maize is expected to arrive in Brittany before the end of the month, traders said, a rare import shipment for the livestock region that reflected a poor French maize harvest.

There was also talk that another two maize import cargoes from eastern Europe would reach Brittany in the coming weeks.

In Germany, cash premiums in Hamburg were flat as slack export business also weighed on the market.

Standard bread wheat with 12 percent protein content for October delivery in Hamburg was offered for sale unchanged at 2 euros over Paris December.

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

“The feed wheat market is providing the main support again rather than exports,” one German trader said.

“But there is great concern about African swine fever and the disruption to pork exports this could bring, as this could cause a fall in feed grain demand.”

Weekly data showed that non-commercial investors increased their net long position in Euronext’s milling wheat futures and options in the week to Oct. 12.

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