EU wheat consolidates above three-month low

PARIS: Euronext wheat futures were little changed on Thursday, consolidating above a three-month low struck a day earlier, as traders weighed signs of an upturn in demand against improving prospects for northern hemisphere harvests.

Spot September milling wheat on the Paris-based Euronext exchange was unchanged on the day at 180.25 euros ($202.10) a tonne at 1603 GMT.

The contract had fallen to 178.25 euros on Wednesday for its lowest since March 18, as the filling of a chart gap to the downside reinforced selling pressure created by more favourable crop weather.

It steadied by Wednesday's close and remained supported on Thursday by fresh demand and an easing euro, rising as high as 182 euros.

"Technically, Euronext tidied up the chart gaps. There was then a bit of short-covering but there aren't many people willing to pay much more," one futures dealer said.

Traders said there was talk of renewed interest in French wheat from Chinese importers after large shipments in the past year, as well as some covering by industrial consumers in Europe after the recent price drop.

Slow selling by farmers was also underpinning prices, traders added.

However, a large number of offers of Black Sea wheat in a tender held by Egypt, in which no French supplies were offered, underlined competition for the 2020/21 season that starts in July.

Beneficial rain in Europe is also expected to have averted further yield losses after a very dry spring, though the European Union is still set for a much smaller harvest this year.

An advancing US winter wheat harvest that was producing some better than expected yields contributed to an eight-month low for Chicago wheat on Thursday.