Euronext wheat eased on Wednesday as surprise over a sharply reduced forecast of Russia's harvest subsided, encouraged by beneficial rain for US spring wheat and a backdrop of ample global supplies. Benchmark December wheat on the Paris-based Euronext exchange settled 2.75 euros, or 1.5 percent, down at 184.50 euros ($217.51) a tonne, giving back gains notched up at the end of the previous session after the US Department of Agriculture's (USDA) monthly world crop report.
The USDA cut its Russia wheat harvest estimate to 68.5 million tonnes from 72 million tonnes, fuelling concern about the impact of dry weather on several wheat-exporting countries.
But traders said the extent of yield losses in Russia was still unclear and also pointed to the USDA's increased forecast for global wheat stocks in 2018/19. "The USDA is more pessimistic than other forecasters and that's a surprise," one futures broker said. "The market is correcting an excessive price move from yesterday, even if the weather remains worrying in the Black Sea region."
In France, farming agency FranceAgriMer made minor adjustments to its wheat supply and demand estimates for the 2017/18 season that ends this month, confirming its expectation that a 12-year high for soft wheat shipments within the European Union will outpace exports outside the bloc.
It warned, however, that logistical difficulties linked to rail strikes and torrential rain made it difficult to estimate the supply situation in France.
In Germany, cash market premiums in Hamburg were little changed, staying at recent high levels amid continuing concern about dry weather damaging wheat crops in northern and eastern export zones.
New-crop standard bread wheat with 12 percent protein for September delivery in Hamburg was offered for sale unchanged at 2 euros over Paris December. "The weather forecasts in the north and east remain mostly dry for the coming days with no major turnaround currently expected," one German trader said.
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