PARIS: Heightened geopolitical tensions over Ukraine pushed Euronext wheat higher on Thursday but gains were capped by concerns over French export prospects following tenders by Algeria an Egypt. May wheat, now the most active contract on Paris-based Euronext, was up 2.50 euros, or 0.9%, at 269.00 euros ($305.64) a tonne by 1718 GMT. In a choppy session, the contract rose as high as 271.00 euros and also fell to a one-week low of 265.75 euros.
US President Joe Biden said on Thursday there was now every indication Russia was planning to invade Ukraine, adding to concerns about conflict in the Black Sea region after Ukrainian forces and pro-Moscow rebels traded fire.
Wheat futures have reacted nervously to developments in Russia’s standoff with the West over Ukraine, with investors fearful of a conflict that could disrupt massive grain exports through the Black Sea.
However, ample offers of wheat from the Black Sea region in a tender held on Thursday by Egypt tempered market concerns.
“Despite all the worry about war, Russian and Ukrainian wheat was offered in large volumes and low prices in Egypt’s tender,” one German trader said.
Egypt’s tender, in which state buyer GASC booked 180,000 tonnes of Romanian wheat, along with results reported from a separate tender by Algeria dampened export sentiment in France.
Algeria’s state grains agency OAIC is believed to have purchased around 700,000 tonnes of wheat in a tender, according to traders.
While a bar on French wheat due to a diplomatic row between Paris and Algiers appeared to have been lifted, French prospects of filling some of OAIC’s latest order were seen as limited given competitive Black Sea prices, traders said.
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