PARIS: European wheat prices surged to two-year highs on Wednesday in light trade following a surge in Chicago after having spent most of the day nearly unchanged.
Benchmark March milling wheat on Paris-based Euronext, was up 0.9% by 1600 GMT to 214.00 euros a tonne after touching 214.50 euros a tonne, a contract high and the highest level traded on the front-month contract for over two years.
By the same time most traded wheat on the Chicago Board of Trade (CBOT) was up 3.4% to $6.39-3/4 after hitting its highest level in 6 years in earlier trade.
“It’s the last day before year end. There are some adjustments being made,” a trader said, stressing however that volumes exchanged on Euronext remained relatively thin.
Eyes were also on Algeria’s wheat tender closing on Wednesday.
By 1600 GMT traders said Algeria had not made any purchase yet in its latest tender to buy milling wheat, with the state agency offering around $288 a tonne cost and freight included.
Traders were optimistic that EU wheat would supply any purchase in the tender despite changes to Algeria’s tender specifications this year making offers of Russian wheat realistic.
“Russian wheat prices remain high ahead of the Russian grain export tax on Feb. 15,” one German trader said. “The feared a flood of cheap Russian wheat offered in export markets in the weeks ahead of the export tax is not being seen.”
“Algeria is seeking shipment just as the Russian export tax is due to be implemented. I think the market expects EU wheat to be used to supply any Algerian purchase.”
Standard milling wheat with 12% protein for January delivery in Hamburg was offered for sale unchanged, remaining well over Paris prices at around 5.0 euros over Paris March.—Reuters
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