PARIS: European wheat futures rose to more than 13-year highs on Wednesday, buoyed by ongoing concerns about global supplies and next year’s harvest, but pared gains before the close on disappointing results in Egypt’s tender, traders said.
Benchmark December milling wheat on Paris-based Euronext was unchanged at the close at 284.75 euros a tonne.
It earlier touched 286.75 euros a tonne, the highest price on the front-month contract since March 10, 2008.
March futures, now the most active position on Euronext, rose as high as 281.75 euros, also the highest level for a second-month price since March 2008, before ending flat.
“The record high of 300 euros per tonne achieved in September 2007 is no longer very far off, in other words.
Whether this can be reached will depend in part on whether EU wheat can still compete on the world market at the current price level,” Commerzbank said in a note.
Egypt’s state grains buyer, the General Authority for Supply Commodities (GASC), bought 360,000 tonnes of wheat in its latest tender on Wednesday.
This comprised 180,000 tonnes of Russian wheat, 120,000 tonnes of Ukrainian wheat, and 60,000 tonnes of Romanian wheat.
Concern was mounting about next year’s harvest; notably in the Black Sea region where continuing dry weather could hamper winter grain sowing in Ukraine and result in a smaller sown area in Russia, the world’s largest wheat exporter, analysts and weather forecasters said on Wednesday.
This comes after a lower-than-expected rating of recently sown U.S. winter wheat added to initial concern about the 2022 harvest potential due to tensions in fertiliser supply and projections for persisting drought in some North American wheat belts.