EU wheat hits 2021 low as Algeria tender fails to boost sentiment

PARIS: Euronext wheat extended losses on Tuesday to their lowest this year, as news of a tender by Algeria failed to offset selling pressure linked to sluggish demand, falling Black Sea export prices and favourable crop conditions.

Positioning by investors, who have built up large long positions in grains in recent months, also weighed on the market ahead of widely followed U.S. planting and stocks estimates on Wednesday.

May milling wheat on Paris-based Euronext, the last available contract for the 2020 harvest, settled down 1 euro, or 0.5pc, at 209.75 euros a tonne.

It earlier fell to 208.75 euros, its lowest since Dec. 30, but found chart support at that level, dealers said.

Algeria issued on Monday a tender to buy milling wheat, with bidding on Wednesday.

The tender should bring further sales for European Union wheat in its main export market, but traders said the market remained focused on the absence of other importers like Saudi Arabia.

New-crop September on Euronext also slipped to a three-month low of 192.25 euros, before settling down slightly at 193.25 euros.

Good growing conditions in much of the northern hemisphere, including improved ratings for wheat in the top U.S. growing state of Kansas, were curbing new-crop prices.

In exports, concern eased over congestion in the Suez Canal as ships held up by a giant stranded vessel started to move.

Two vessels transporting in total around 126,000 tonnes of French barley to China, part of a busy programme of French barley shipments this month, have been caught up in the week-old queue in and around the canal, Refinitiv and other shipping data showed.