PARIS: Euronext wheat futures dropped to a 16-month low on Monday as hefty harvest supplies and chart-based selling agai
PARIS: Euronext wheat futures dropped to a 16-month low on Monday as hefty harvest supplies and chart-based selling again offset a potential export boost from a falling euro.
December milling wheat on Paris-based Euronext settled 1.25 euros, or 0.7pc, lower at 166.75 euros ($185.83) a tonne, a fresh life-of-contract low and the weakest level for a second-month position since late April 2018.
A further fall for the euro, which again touched levels last seen in 2017 at under $1.10, failed to counter price pressure created by big northern hemisphere harvests, tepid export demand and investment fund selling, traders said.
"You would have thought the euro's slide would help Euronext but we're still feeling the pressure of export competition," a futures broker said.
"We'll have to see what way Chicago goes when it reopens."
US wheat markets, which fell sharply on Friday, were closed on Monday for the Labor Day holiday.
Volumes were light on Euronext, while on the French cash market activity was also thin as the US holiday added to the lull with participants in Europe only just returning from summer breaks.
The European Commission raised its monthly estimate of this year's European Union soft wheat harvest to 142.7 million tonnes from 141.3 million previously, confirming a rebound from last year's drought-hit level.
Weekly data also showed a rise in EU wheat exports compared to a year ago.
But traders say the export pace is not yet sufficient, particularly in west EU countries, to absorb the much bigger harvest in the face of competition from eastern European wheat.
"The euro's weakness is very welcome but rivals such as Lithuania and the other Baltic States are still about 2 euros a tonne cheaper," a German trader said.
Standard bread wheat with 12pc protein for September onwards delivery in Hamburg was offered for sale unchanged at 0.5 euro under Paris December to level Paris. Buyers were seeking at least 2 euros under Paris.
In Poland, new-crop exports were also slack.
"Our wheat in Poland is just too expensive in comparison with the Baltic States and Black Sea," one Polish trader said.
"In general Poland's exports are rather slow, with the main new trading focused on small vessels for the internal EU market."
Polish millers are offering to buy 12.5pc protein wheat at 670-700 zloty a tonne (153.3-160.2 euro ) for September delivery depending on region, unchanged on the week.
Exporters are offering to buying 12.5pc protein wheat for immediate delivery to ports at an unchanged 705 zloty a tonne.
Traders report two ships loading wheat for Saudi Arabia in Poland, one of 55,000 tonnes and the other 60,000 tonnes.