European wheat prices mostly declined on Thursday, with the most-active contract returning to a two-month low hit the previous day in a catch-up move after a sharp drop in Chicago on Wednesday evening. December milling wheat on Paris-based Euronext unofficially closed down 0.3 percent at 158.75 euros a tonne while March was unchanged at 163.25 euros. On the Chicago Board of Trade, wheat bounced back by 0.8 percent after losing 1.9 percent on Wednesday in its biggest one-day decline since early September.
The results of Egypt's much-awaited tender showed that state buyer GASC was able to book big volumes at relatively low prices, suggesting a low risk premium linked to renewed uncertainty over the state's import policies. GASC paid between $208.60 and $209.45 a tonne for the wheat, below the $210 a tonne paid on November 8 for 120,000 tonnes of Russian wheat. But the number of participants in the tender was low, limiting volumes offered. "If Russian wheat cannot be sold to Egypt it will no doubt be offered in other markets in even hotter competition with EU wheat," a German trader said.
Strong competition from Black Sea grain has hit international demand for French wheat since the start of the season, prompting FranceAgriMer on Thursday to lower its forecast of French soft wheat shipments outside the EU in 2017/18. The farm office said, however, that it expects an improvement in the coming months as France often does the bulk of its export programme in the second half of the season.
German cash premiums in Hamburg were flat, with milling wheat again being sold for animal feed because of higher prices offered by feed makers. Standard bread wheat with 12 percent protein content was offered for sale unchanged at 3 euros over the Paris December contract for November delivery in Hamburg. Buyers were offering 2.5 euros over.
Feed wheat in Germany's South Oldenburg market was again quoted way above milling wheat, offered for sale at 175 euros a tonne for nearby delivery, with buyers offering around 174 euros. "The feed wheat industry continues to provide the main demand, especially in north Germany," the trader said. "German mills seem to have pretty good supply cover." "Supportive factors are that farmers are unwilling sellers at current low prices. There are also fewer sale offers of Polish wheat in Germany following Poland's disappointing harvest this summer."
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