HAMBURG: European wheat rose on Monday to equal last week’s two-year high as weather concerns in major exporting countries and steady international demand supported prices.
December milling wheat on the Paris-based Euronext exchange was up 1.0 euro, or 0.5%, at 197.75 euros ($233.05) a tonne at 1616 GMT.
It earlier hit 198.50 euros, matching last Thursday’s two-year high, but faced resistance ahead of a life-of-contract high of 199 euros and the psychological 200 euro threshold.
Dry sowing conditions in Russia and the US Plains fuelled a sharp rise in Russian and US futures.
“The wheat market is seeing a latest upward burst,” consultancy Agritel said in a note.
“Speculative factors are not lacking at the moment with a moisture deficit that is worsening for winter wheat in Russia and the United States.”
In France, heavy rain since late September has raised some concern about a repeat of waterlogged conditions that disrupted wheat sowing a year ago, although weather forecasts point to some drier spells in the coming two weeks.
Rising Black Sea prices were leading to hopes of more export sales by Germany and elsewhere in the Baltic Sea region.
Russian wheat export prices rose last week, with lack of rain also underpinning as winter wheat is planted.
High demand from importers and rising global prices helped Ukraine’s milling wheat export prices to increase over the past week.
“There is the expectation that the rising Russian and Ukrainian prices will help push purchases in upcoming purchase tenders away from the Black Sea region,” one German trader said. “It was disappointing to see Russian wheat was still the cheapest offer in Pakistan’s tender.”