EU wheat futures rise, rapeseed hits new highs

Benchmark European wheat futures edged higher on Friday in line with Chicago, underpinned by higher Russian prices in a tender from Egypt, while rapeseed extended a rally to new contract highs amid short-covering on the front month.
March milling wheat on Euronext settled up 0.25 euro or 0.2 percent at 169.75 euros a tonne.
The contract tracked a slight rise in Chicago, where wheat futures halted a two-day fall.
The market also drew some support from a latest tender by Egypt which showed a significant rise in Russian wheat prices compared with a week-earlier tender, leading Egypt's state buyer to book just 60,000 tonnes of Ukrainian wheat.
"We had relatively high prices for Russian wheat offered in the Egyptian tender and that surprised the market," one futures dealer said.
"This countered a bit the pressure from chart resistance faced by Euronext and Chicago futures."
A loss of competitiveness for Russian wheat was helping the European Union export at a good pace, even if shipments were expected to fall sharply over the full season, analysts and traders said.
In Germany, cash market premiums were little changed, with attention on the possible impact of persisting deep frosts.
Standard wheat with 12 percent protein content for January delivery in Hamburg was offered for sale at 4 euros over the Paris March contract. Buyers were seeking 3.50 euros over.
"Germany again had double-digit frosts on Thursday night with minus 20 degrees Celsius in some southern areas but at the moment it is still hard to say if there will be any serious impact on wheat plants," one German trader said.
"However, warmer temperatures are forecast next week and with a lot of snow cover to protect crops, the market is taking a rather relaxed view of the cold weather this week."
Traders also saw limited risks for wheat in France, where the cold spell is also expected to ease next week, although some rapeseed that was in poorer condition coming into winter was seen as vulnerable in northeast France.
The weather risks added support to a short-covering rally in rapeseed futures as operators covered positions in the run-up to the expiry of February futures on Euronext on January 31.
Tight supply in Europe, partly due to a smaller EU harvest and a slower than expected pace of imports, had prompted some operators to exit positions to avoid having to deliver rapeseed against spot futures, dealers said.
February rapeseed touched a new contract high of 425.75 euros a tonne, also a highest spot price since April 2014, before later settling 1.0 percent higher at 425.00 euros.