European wheat prices fall as US markets down

European wheat prices in Paris fell on Tuesday, pressured by weakness in US futures, while a firmer euro and the latest sale of Russian wheat to Egypt emphasised the tough export environment. May milling wheat on the Paris-based Euronext exchange was down 0.50 euros, or 0.3 percent, at 165.25 euros ($205.11) a tonne at 1711 GMT.
The contract earlier equalled Monday's one-week low of 164 euros but found support at that level. The euro rose to an export-punishing two-week high against the dollar at more than $1.24, making grain from euro zone countries such as France more expensive overseas. Egypt bought 175,000 tonnes of Russian wheat in a tender, as Russia maintained its price edge despite its recent sharp rise.
Traders said there was some disappointment that no suppliers offered French wheat in the Egyptian tender after the price gap with Russian wheat had narrowed. Only Russian and Romanian wheat was offered. On the cash market in France, premiums for spring malting barley were higher amid growing concern about sowing delays.
Field work is running behind last year's pace and heavy rain forecast for the coming two weeks could further hamper sowing after a wet winter and lead some farmers to switch to later-planted maize, traders said. In Germany, wheat cash market premiums in Hamburg dipped in weak demand, with traders hoping crops survived double-digit frosts last week without major damage. Standard bread wheat with 12 percent protein content for March delivery was offered for sale down 1 euro at 2 euros over Paris May.
"There is little demand in the market with mills looking to have good supply cover and export loadings modest," one German trader said, adding that forecast frosts of only about minus 3 degrees Celsius this week are of little concern compared with the potentially dangerous frosts of minus 10 to minus 17 degrees in Germany last week. "It is a little surprising that markets in Germany have hardly reacted at all to the frosts given the low temperatures on wheat with little protection from snow cover in some areas. But we will not see the actual impact for some weeks."