PARIS: Paris wheat futures fell to a two-month low on Monday as export data and a firm euro fuelled growing doubts about the extent to which western Europe can profit from reduced supply in top exporter Russia.
A sharp fall in Chicago wheat, which slid 2 percent, and technical pressure in Paris following last week's option expiry on front-month futures added to selling pressure.
Front-month December milling wheat on Paris-based Euronext settled down 3.00 euros, or 1.5 percent, at 196.75 euros ($225.16) a tonne, after earlier touching its lowest since Sept. 14 at 196.25 euros.
The March contract, now the Euronext delivery position with the biggest open interest, settled 3.00 euros lower at 200.00 euros, after hitting a two-month low of 199.75 euros in closing deals.
March futures extended losses in late trade as prices broke through a support zone at 200.75-201.00 euros, dealers said.
European Union soft wheat exports in the 2018/19 July-June season are so far down 27 percent compared with a year ago, official data showed on Monday.
EU maize imports, meanwhile, remain well ahead of last season's pace, reducing potential domestic demand for wheat as livestock feed.
"It's proving a long wait for the optimistic scenario for the second half of the season," one futures dealer said.
"The decline in EU wheat exports is becoming more pronounced, maize imports into the EU are surging and each week the Russians are exporting another million tonnes of wheat."
The euro rose to its highest in over a week against a broadly weaker dollar, making grain from exporting countries like France and Germany more expensive.
EU wheat was expected to claim some sales in a 495,000 tonne optional-origin purchase by Saudi Arabia on Monday.
"I suspect most of the Saudi purchase could be sourced in the European Union but from a spread of origins," one German trader said.
"We hope one or two shipments could come from Germany but exporters are suspected to have such long positions in German wheat after a long period of slack German exports that they will not need to buy new supplies."
Premiums for wheat with 12.5 percent protein, the type sought in the Saudi tender, were unchanged at around 4 euros over Paris for November-December delivery in Hamburg.
For January-March delivery the premium fell to 5.5 euros over Paris from 6 euros over on Friday.
Standard bread wheat with 12 percent protein for November delivery in Hamburg was offered for sale unchanged at 2.5 euros over Paris December. There was a wide gap between buyers and sellers, with purchase offers of only 1.0 euro over Paris heard.
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