Paris wheat at three-week low as Australian and Russian exports loom

HAMBURG: European wheat futures in Paris fell to a three-week low on Monday as Australian harvest expecations and a proposal to expand Russia's export quota raised the prospect of higher supplies to rival EU sales.

March milling wheat, the most active contract on the Paris-based Euronext exchange, unofficially was down 3.25 euros, or 1.5%, at 206.75 euros ($246.9) a tonne by the close after touching its lowest since Nov. 9 at 206.25 euros.

Chicago wheat slid by about 3% in US trading, adding weakness.

"Australia and Russia are making the headlines today and it's bearish," one futures dealer said.

Australian agency ABARES said the country's 2020/21 wheat production will total 31.17 million tonnes, up from a September estimate of 28.91 million tonnes.

Russia could increase the size of its grain export quota planned for Feb. 15 to June 30 to 17.5 million tonnes from 15 million tonnes, the agriculture ministry said.

Physical market prices in France were marked up to compensate for Euronext as strong export demand continued to absorb a dwindling harvest surplus.

In France, port data showed that more wheat and barley cargoes were due to load for China.

Traders also said that a vessel loading wheat at Dunkirk for an unknown destination was believed to be for Pakistan, marking a further sale of European Union wheat to the Asian country after recent shipments of German wheat.

In Germany, extensive export shipments loading in ports and hopes of more export sales continued to hold Hamburg prices above Paris prices.

Standard bread wheat with 12% protein for December delivery in Hamburg was offered for sale unchanged at about 4.50 euros over Paris March.

"Algeria continues to be a big export destination for German wheat this winter," one German trader said.

Three ships are set to load a total of about 150,000 tonnes of German wheat for Algeria in the first week of December, traders said.