Paris wheat drifts down, as new virus strain weighs

HAMBURG: European wheat futures in Paris drifted down on Monday in thin pre-holiday trade, as concern over a new coronavirus strain triggered some selling.

March milling wheat on the Paris-based Euronext exchange was down 0.50 euros, or 0.2pc, at 208.00 euros ($254.1) a tonne at 1630 GMT.

Euronext lacked impetus from little-changed Chicago wheat, with movements in grain markets focused on soybeans.

"Wheat has been consolidating for a few days without finding a fresh catalyst," a futures dealer said.

Traders said they were weighing the export-boosting weakness of the euro against the dollar against uncertainty linked to the spread of the new coronavirus strain in Britain that has led to the suspension of transport links with countries including France.

The French grain market was beginning a traditional two-week year-end break around the Christmas and New Year holidays, with firms only handling essential business.

Wheat markets were assessing the possible consequences of a Russian wheat export tax from Feb. 15 as part of measures to cool domestic food prices.

In Germany, premiums were supported by hopes that Russia's export restrictions in February will push more business to the European Union.

Standard bread wheat with 12pc protein for January delivery in Hamburg was offered for sale unchanged at around 5.0 euros over Paris March.

"Currently hopes of more export sales from Germany rather than actual new export sales are supportive," one German trader said.

"The question is how much wheat Russia will be able to push out into world markets before the export tax starts on Feb. 15, and how much Russian exports will be impeded unofficially by the authorities."

Germany's winter wheat sown area for the 2021 harvest has been increased by 2.7pc on the year, Germany's statistics office said on Monday.

"The outlook for Germany's 2021 harvest is good with no serious problems currently visible," the trader added.