PARIS: European wheat rose over 1% on Tuesday on disappointing US winter wheat condition that sent Chicago wheat higher and hopes of renewed demand after Algeria issued a tender for soft wheat and despite French wheat being excluded in the previous one.
Benchmark December milling wheat on Paris-based Euronext, was up 1% by 1700 GMT to 219.25 euros a metric ton.
The US winter wheat crop is in much worse shape than market participants thought, according to USDA data released late on Monday.
The USDA rated 38% of the US winter wheat crop in good to excellent condition, below analyst estimates in a Reuters poll of 47% and the second-lowest for this time of year in USDA records dating to 1986.
“The poor condition results for US wheat came as a surprise and Euronext is rising in team with Chicago,” a trader.
There were also signs of some new demand with major buyer Algeria issuing a wheat purchase tender on Tuesday.
The market will be watching whether Algeria clears French wheat in the tender after it excluded them from its previous wheat import tender in October, in apparent fallout from renewed diplomatic tensions between Algiers and Paris.
Traders said the tender could also provide a clearer view of the impact of Russia’s unofficial minimum wheat export price, imposed to cool Russian flour and bread prices, with continued talk that Russian wheat was being offered for sale below the floor price.
Source: Brecorder
