PARIS: European wheat edged down on Wednesday to a new one month low as traders assessed mixed indications for harvests and demand. Front-month September milling wheat on Paris-based Euronext, unofficially closed down 0.75 euro, or 0.4%, at 179.00 euros ($212.67) a tonne, its lowest since June 30.
Paris prices found some support from a steadier trend in Chicago futures, but faced pressure from a sharp rise in the euro against the dollar. France's farm ministry lowered its estimate of the soft wheat harvest to 29.71 million tonnes, down 1.6 million tonnes from its initial forecast last month and now 25% below last year's crop, due to the continued effects of adverse weather.
"It's a terrible situation for soft wheat production," a French broker said. "There won't be much French exports and there is a lot of re-selling for the domestic market, particularly to Brittany." Rising expectations for Russia's harvest and sizeable offers of Black Sea wheat in an Egyptian import tender also curbed Euronext.
In Germany, traders played down a forecast from Germany's statistics office on Tuesday that the wheat crop could fall about 12% year on year to 20.23 million tonnes. "I think the general opinion is that the statistic office's forecast is far too pessimistic and is based on information in June which is not confirmed by the positive yields we are seeing from the wheat harvest results," one German trader said.
"I think the market consensus is for a German wheat crop in a corridor between 21-22 million tonnes with estimates of 22.5 million tonnes still in the market today." The statistic office's estimate was based on data gathered in June and is well below the 22.46 million tonnes by Germany's farm cooperative association in July after rain improved the harvest outlook. Sunny weather was expected to enable rapid wheat harvest progress this week in Germany, traders added.
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