PARIS: Euronext wheat futures fell on Tuesday as the previous session’s bounce stalled in cautious trading while market participants awaited results of a tender by major importer Algeria. March milling wheat on the Paris-based Euronext exchange was down 1.25 euros, or 0.4%, at 285.00 euros ($321.20) a tonne by 1651 GMT.
The contract failed to build on Monday’s rise but trimmed losses in afternoon trading as it held above chart support levels, dealers said. A wave of demand from importers after prices dropped from last month’s record levels has lent some support to futures, countering pressure from improving global supply prospects.
However, there was uncertainty over the outcome of a tender being held on Tuesday by Algeria, the main export market for European Union wheat. French wheat was seen as relatively price-competitive, but a move by Algerian grain agency OAIC to maintain more favourable terms for Russian supplies was raising doubts about EU prospects.
“The question is whether Algeria is deliberately seeking non-EU supplies,” one trader said. OAIC was not thought to have made a purchase yet in the tender. Traders said the agency was seeking to pay about $375 a tonne, cost and freight (c&f) included, while offers from suppliers were reported at above $380 a tonne c&f.
In Germany, traders were cheered by brisk activity in the international tender market, with new wheat purchase tenders issued by Iran and the Philippines on Tuesday. “More tenders had been expected as prices fell back and we are now seeing them being issued. But some big buyers like Iraq, which is believed to have a large requirement, are still absent,” another trader said.
Standard 12% protein wheat for delivery in January onwards in Hamburg was offered for sale at about 8 euros over Euronext March. Most grain crops in the EU have benefited from favourable autumn weather, though a lack of hardiness could leave some plants vulnerable to winter frost, the EU’s crop monitoring service said. The weekly EU grain export and import data was delayed to Wednesday owing to a technical problem.
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