Euronext wheat futures climbed to their highest in over a year on Monday, buoyed by Russian plans to temporarily withdraw from the export market that could reinforce brisk demand for EU supplies.
Dry weather across Europe and the Black Sea region also supported the wheat market, with a sharp cut by consultancy IKAR to its forecast for this year's Russian wheat harvest keeping the focus on potential damage to crops.
On Paris-based Euronext, front-month May futures rose as much as 3.8% to 206.00 euros ($223.88) a tonne, a life-of-contract high and the loftiest spot price since the end of January last year.
The contract later settled up 5.25 euros, or 2.6%, at 203.75 euros.
The risk of top wheat exporter Russia ending its export season early, and talk of limited availability of physical supplies in France, kept attention on tightening export supply.
Russia's deputy agriculture minister Oksana Lut said on Friday the country would suspend exports until July 1 once its second-quarter export quota was exhausted, which is expected to happen in mid-May.
"Despite a heavy export programme already in place, French and EU wheat is still benefitting from its competitiveness against Black Sea origins that are subject to quotas," consultancy Agritel said in a note.
Weekly European Union data showed the bloc plus Britain had exported 27.16 million tonnes of soft wheat so far in the 2019/20 season, up 62% from a year ago.
In Germany, standard bread wheat with 12% protein for May delivery in Hamburg was offered for sale little changed at around 6 euros over the Paris May contract.
Buyers were offering around 5 euros over Paris.
"Export demand could be switched to the EU if Russia's quota is used up, with France, Germany, Poland and the Baltic States set to be the winners," one German trader said.
"A major limiting factor in Germany is that so much wheat has been exported in the last few months that the volume available for export is thought to be small. The heavy buying of flour and bread by the public in the coronavirus outbreak has also kept internal wheat demand high," the trader added.-
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