EU wheat supported by Chicago bounce, slow farmer selling

PARIS: European wheat markets were steady on Thursday as a slight rebound in Chicago futures and slow farmer selling underpinned prices in the face of lagging export activity.

Traders were monitoring an intense cold spell building across Europe but said it was too early to talk of crop damage.

May milling wheat on the Paris-based Euronext exchange settled 0.50 euro, or 0.3 percent, higher at 163.50 euros ($201.68) a tonne, equalling Tuesday's three-week peak.

However, the contract continued to face chart resistance at that level.

"There is still very little selling pressure from 2017 crop even though it's nearly March," a French cash broker said. "The market is tracking the incoming cold spell but that's not prompting any precautionary buying."

Slow farmer selling, attributed to dissatisfaction with market prices, has been a feature of this season in western Europe, and traders say this has contributed to lacklustre exports in the face of stiff competition from Black Sea origins.

Weekly European Union data showed EU soft wheat exports were still running 19 percent below last season's level as of Feb. 20.

A rise in the euro against the dollar, after a pullback this week from a three-year high, also underscored a tough export backdrop for western European wheat.

In Germany, modest export loadings were depressing sentiment but forecasts of deep frosts next week were being closely monitored.

Standard bread wheat with 12 percent protein content for February delivery in Hamburg was offered for sale unchanged at around 5.5 euros over Paris March.

In Poland, prices were little changed in the past week.

"Farmers are still reluctant sellers and are hoping for higher prices," one Polish trader said.

"Polish wheat is now among the most expensive in Europe due to stubborn farmers withholding supplies and steady domestic demand in past weeks."

"But flour mills and feed mills seem to have reasonable supply cover for the next four to six weeks and were reluctant buyers in past days," the trader added.

Polish millers were offering to buy 12.5 percent protein wheat for February/March delivery at 640-660 zloty (153.1-158 euros) a tonne, unchanged on the week. Feed mills are paying the same prices for feed wheat.

Exporters were offering 12.5 percent protein wheat at 670-675 zloty a tonne for February delivery to ports, also unchanged.

The trader noted a light export loading programme, with one ship loading 33,000 tonnes in Gdynia and one in Stettin/Swinoujscie loading 31,000 tonnes.