PARIS: Euronext wheat futures rose on Tuesday to match a 2-1/2 week high struck a day earlier, supported by a rebound in Chicago and uncertainty about the French harvest after an unexpectedly low forecast at the end of last week.
December milling wheat, the most active position on Paris-based Euronext, was up 2.25 euros, or 1.2 percent, at 185.75 euros a tonne by 1541 GMT
It earlier equalled Monday’s high of 186.00 euros, a level not previously reached since June 13.
Chicago wheat climbed 2 percent after a 4 percent slide in the previous session attracted bargain buyers.
European traders were continuing to digest a 4.6 million tonne cut by consultancy Strategie Grains to its forecast for the French harvest, which has added to concern about weather-related losses in northern Europe.
French market participants said expectations generally remained above Strategie Grains’ 33.2 million forecast, although some estimates have been scaled back to 35.5-36 million tonnes from 37-38 million last month.
“We’re going to have to wait for harvesting to reach major production zones in the northern half of France to confirm or knock down Strategie Grains’ scenario,” one trader said.
Wheat harvesting has got off to a very early start in France amid a warm, dry spell, and there was even talk of initial cuttings north of Paris, cash brokers said.
Mixed results in winter barley harvesting were also fuelling doubts about the size of the wheat crop.
“We’re seeing with the barley that as we go along results are not as good as expected,” one broker said. “It’s not what we were hearing three weeks ago, we thought France wasn’t concerned by the disappointment over the European crop.”
Northern Europe, including part of Germany, endured very dry, hot conditions at the end of spring, leading forecasters to reduce harvest estimates.
French traders were also monitoring the impact of storms forecast to move up from the south of the country following a heatwave in recent days.
Offers reported in an import tender being held by Algeria lent further support to Euronext.
The lowest offers were thought to be around $237 a tonne, cost and freight, well above the sale price in Algeria’s previous tender, although the country’s state grain buyer was reportedly seeking to pay $231, traders said.
CME Group has terminated its European Union wheat futures and options contracts after liquidity dried up in the derivatives, the market operator said late on Monday.
Source: Brecorder
