PARIS: Euronext wheat edged up on Thursday in step with Chicago as futures recovered from liquidation this week, with export news shifting attention back to supply tensions.
However, gains were limited by the latest diplomatic comments about a possible reopening of Ukraine’s sea ports as well as weather forecasts suggesting more rain relief in parched US and European wheat belts.
September milling wheat on Paris-based Euronext settled up 0.5% at 382.50 euros ($410.73) a tonne.
On Wednesday, September futures had fallen to a one-month low of 374.75 euros, taking losses since the start of the week to 40 euros, or nearly 10%.
Discussions over a shipping corridor for Ukrainian grain amidst the ongoing war with Russia, along with improving weather for US and European crops had encouraged the pullback after record prices in recent months.
Russia’s defence ministry said on Thursday that vessels carrying grain can leave Ukraine’s ports in the Black Sea via “humanitarian corridors” and Russia is ready to guarantee their safety, Interfax news agency reported.
Some traders, however, remained sceptical of a diplomatic solution regarding Ukraine’s ports and also saw supply risks in other exporting zones. [nL8N2XO3DU Egypt’s state grains buyer, the General Authority for Supply Commodities (GASC), said late on Wednesday it bought 465,000 tonnes of wheat in an international tender.
The tender suggested the readiness of importers to cover needs when prices ease and underscored the impact of the war, with no offers of Ukrainian wheat and few offers of Russian wheat.
“Last year you would have had 10 offers of Russian wheat,” one European trader said. “Yesterday’s tender shows the problem is not a lack of demand.” Although food is not the subject to Western sanctions imposed over Moscow’s invasion of Ukraine, traders say companies see risks in shipping goods from Russia.
Export restrictions in India were adding to global supply tensions.
Traders said there was chatter about Asian millers inquiring about European Union supplies, including French wheat, in case they fail to secure planned volumes from India.
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