PARIS: Euronext wheat climbed on Thursday, spurred by a short-covering rally in Chicago, as hot weather forecast for US and Russian crops turned attention towards yield risks and away from much needed rains in western Europe.
September milling wheat on Paris-based Euronext settled 2.75 euros, or 1.5%, higher at 187.50 euros ($212.36) a tonne, after earlier rising to its highest since May 29 at 188.75 euros.
US wheat futures rose sharply as a weaker dollar provided further support. Conversely, a three-month high for the euro against the dollar capped gains on Euronext.
Traders said forecasts of high temperatures in part of the US Plains in the coming days and in southern Russia from next week were putting the focus on mixed yield prospects after a dry spring in many northern hemisphere growing regions.
Rising Russian export prices, fuelled by harvest concerns and firm domestic prices, were also contributing to the rally in futures, traders added.
Heavy showers since Wednesday in parts of western Europe, including dry northern plains in France and Germany, were expected to help wheat crops, and more rain was forecast to follow in the coming days.
"So far good volumes of rain have fallen but even more is needed," one German trader said.
"The volumes of rain in the forecasts are large and if we get what is forecast the dryness problem could be solved for the time being."
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