Paris wheat futures slightly higher, rapeseed tumbles

Paris wheat futures turned slightly higher on Thursday to recover from an earlier six-month low as a slide in the euro boosted the attractiveness of European supplies and offset pressure from a deepening sell-off in financial markets.

Benchmark May milling wheat on Paris-based Euronext was up 0.75 euro, or 0.4%, at 178.00 euros ($198.42) a tonne by 1705 GMT. It earlier fell to 174.25 euros, its weakest since Sept. 9, and below a previous six-month low of 176.75 euros struck on Wednesday, as equity and commodity prices plunged further as a US curb on travellers from Europe heightened fears about the fallout from the coronavirus.

A steep drop in the euro against the dollar, after stimulus measures announced by the European Central Bank in response to a fast-spreading coronavirus outbreak failed to impress investors, then prompted a recovery in Euronext prices, dealers said.

"The euro is helping technically," one dealer said. "Wheat is also a different case as some people see light end-of-season stocks and good exports." Algeria, the largest overseas buyer of French wheat, was thought to have bought around 680,000 tonnes of milling wheat in a tender on Wednesday, traders said.

The optional-origin purchase was expected to be mostly supplied from France while the $226-$227 per tonne, cost and freight (c&f), price range was seen as broadly in line with current market levels.

A pullback in wheat prices this month has encouraged several importing countries to hold tenders, while dealers have also reported buying of new crop by other wheat consumers, helping keep December futures at around 180 euros.

Strategie Grains raised its estimate for European Union soft wheat exports this season by 600,000 tonnes to 31.2 million to take account of large sales from Germany, although French exports were revised lower. The consultancy also cut sharply its forecast of this year's soft wheat harvest in the EU, to 136.7 million tonnes from 138.6 million projected last month, to reflect the impact of torrential rain in western countries. However, favourable harvest prospects in top wheat exporter Russia, along with a sharp fall in Russian exports prices, were curbing Euronext prices, dealers said.