PARIS: European wheat prices edged higher on Monday, mainly supported by a fall in the euro against the dollar and fresh demand although hefty supplies were capping gains, traders said.
May milling wheat, the benchmark on the Paris-based Euronext, was 0.5 percent higher by 1659 GMT at 154.00 euros a tonne.
EU wheat exports have picked up in the past few weeks, helped by a slump in prices to near five-year lows, with sales recorded to Egypt and Saudi Arabia and a sustained flow of French shipments to Morocco and Algeria..
But the slow start to the export campaign, linked to wrangling over terms for sales to Egypt and low demand from Middle Eastern buyers hit by low oil prices, has dampened hopes the EU will be able to trim end of season stockpiles which are set to be the biggest in seven years.
"Despite the significant line-up (in French ports), notably to Morocco, we won't be able to catch up for the slow start of the campaign," one trader said.
German cash premiums in Hamburg were stable, supported by the hope that some of the 870,000 tonnes of wheat bought by Saudi Arabia on Monday will be sourced in Germany.
Standard wheat with 12 percent protein content for March delivery was offered for sale unchanged at 2 euros under the Paris May contract. Buyers were seeking 3 euros under Paris.
"One of the trading houses that won the Saudi tender had recently built up a large long position in 12.5 percent protein wheat in Germany, Poland and the Baltic States and there is expectation some could be sourced in Germany or Poland," one German trader said.
Polish export prices firmed in the last week, helped by a low level of farmer selling as the market awaited more indications of the precise scale of frost damage to crops. Deep frosts in Poland in early January could have damaged 7-10 percent of its wheat planted area.
"Some farmers have stopped sales, hoping that winterkill will raise prices at the end of the season," one Polish trader said.
Exporters were offering 655-665 zlotys a tonne (150.4-152.7 euros) for 12.5 percent protein wheat for March delivery, up 5-10 zlotys on the week.
Last week, one ship with 44,000 tonnes of wheat left Poland for Cape Town in South Africa and another with 44,000 tonnes left for Kenya, a trader said. One ship is loading 27,000 tonnes of wheat in Gdansk this week for an undisclosed destination.
Polish internal market prices were little changed with millers and feed makers seen holding good supply cover for the next two to three weeks.
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