PARIS: European wheat futures edged higher on Tuesday, steadying after a slide in the previous session as Russia’s less competitive prices in an Egyptian tender kept the focus on an export tax introduced by Moscow.
Grain prices have been volatile over the last week as Russia considered a wheat export tax and grain export quota to cool domestic food prices. On Tuesday, the Russian prime minister signed orders to implement the new measures.
Egypt’s latest tender, in which it bought 120,000 tonnes of Romanian wheat and 115,000 tonnes of Ukrainian wheat, showed fewer offers of Russian wheat than previously and at much higher prices.
That provided support for the view that Russia’s measures will curb exports, although some traders said overseas sales could pick up as domestic Russian prices ease and as a mid-February implementation for the tax approaches.
March milling wheat on the Paris-based Euronext settled 1 euro, or 0.5%, higher at 207.25 euros ($251.77) a tonne.
The contract dropped 2% on Monday, giving up almost all of its gains from Friday when it struck a two-week high.
“I’m not sure this will change things massively,” a French trader said of the Russian measures.
“We’ve had an export quota before and Russia still has its second-largest crop on record to shift.”
However, doubts over the Russian market situation could favour more European Union exports, traders said.
“I think some buyers will be concerned about whether Russian wheat will face delivery problems,” one Polish trader said.
“Polish wheat is still looking competitive on export markets, with busy export traffic supporting prices at recent levels.”
Exporters were offering around 905 zloty (203.5 euros) a tonne for 12.5% protein wheat for December delivery, little changed on the week.
At Gdynia, one ship has just left the port with 32,000 tonnes of milling wheat for Algeria another is loading 28,000 tonnes also for Algeria and one is set to load 70,000 tonnes for Saudi Arabia.
In Szczecin, a vessel is loading 26,000 tonnes of milling wheat for Morocco.—Reuters
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