PARIS: Euronext wheat rose to a two-week high on Wednesday after an unexpectedly low estimate of US corn planting sparked a broad rally in grains and took attention away from a small wheat purchase by Algeria.
Front-month September milling wheat on the Paris-based Euronext exchange settled up 1.00 euro, or 0.6%, at 181.50 euros ($204.33) a tonne.
In late trading it rose to 182.25 euros, its highest since June 15.
Chicago grain futures added to sharp gains from Tuesday when the US Department of Agriculture (USDA) surprised the market with a steep cut to its estimate of this year's US corn area.
"The US corn planting figure has changed the shape of the market, which has gone from extremely heavy to just heavy," a futures dealer said.
Gains on Euronext were capped by technical resistance, caution ahead of the European harvest and reports Algeria made a relatively small purchase in a tender.
Algeria is believed to have bought about 300,000 tonnes of milling wheat in a tender which closed on Tuesday, traders estimated on Wednesday.
That was more than initial talk on Tuesday of a 240,000 tonne purchase, but still below Algeria's typical monthly demand while prices were seen as aggressive.
"The price looks low and would be tough to source in France unless sellers are hoping French prices will fall as the harvest starts," one German trader said.
"I think the Baltic Sea region may well be used to supply a good volume of the tender purchase."
In Germany, rainfall was continuing to ease concerns about the impact of a dry spring, although it may delay the start of wheat harvesting, traders said.
Comments
Comments are closed.