Paris wheat eases after two-month high on export hopes

PARIS: Euronext wheat futures ended lower on Friday after an earlier two-month high linked to brightening export prospects triggered some selling before the weekend, traders said.

Benchmark March milling wheat on Paris-based Euronext settled 0.75 euros, or 0.4 percent, lower at 206.75 euros ($233.69) a tonne.

It earlier hit a two-month peak at 208.50 euros before the latest gains prompted a bout of selling, traders said.

Over the week, it was up 1.5 percent compared with last Friday's closing level of 203.75 euros.

This week's gains have been supported by rising prices in Russia that have lent weight to expectations the world's largest wheat supplier is losing competitiveness after exports set a record pace in the early part of the 2018/19 season.

News of a meeting next Friday between grain exporters and Russia's agriculture ministry has also revived speculation the government may seek to rein in exports in order to curb domestic food inflation.

In addition European traders have become less concerned about competition from Argentina in north African markets, given rising Argentine prices.

Physical premiums in Rouen, France's main wheat grain port, rose on Friday against a backdrop of talk of fresh export activity, traders said.

A further fall for the euro, which dropped to its lowest in over two weeks against a broadly stronger dollar, also supported export optimism in France.

However, some market participants say upside for wheat prices may be short-lived if Russia keeps exporting steadily and if forecasters continue to point to a large harvest in Europe and the Black Sea region next year.

Analyst firm Strategie Grains on Thursday projected next year's soft wheat harvest in the European Union, including Britain, would rebound to a four-year high of 147 million tonnes.