HAMBURG: European wheat futures closed slightly lower on Thursday as traders assessed reports of progress in talks to create a safe corridor for ships to transport Ukraine’s grain exports.
A public holiday in France kept some market participants away.
Front-month September milling wheat on the Paris-based Euronext exchange settled down 1.50 euros, or 0.4%, at 342.75 euros ($342.58) a tonne, well above an earlier session low of 335.50 euros.
“US export sales were strong today, the numbers of ships lining up to ship French and other EU wheat exports is expanding while there is growing doubt we could really see a safe shipping corridor set up soon from Ukraine,” one trader said.
Ukraine and Russia see positive signs in talks which could lead to the resumption of Ukraine’s sea-borne grain exports after Wednesday’s talks in Istanbul, with Turkey saying a deal is possible next week.
The Istanbul talks delivered elements of a possible deal on a Ukrainian shipping, Russia’s foreign ministry said.
“The devil is in the detail and there are big issues which must be resolved,” one trader said. “There is still a lot of scepticism and doubt in the market that a safe shipping channel will be agreed quickly. But this is the first time in months we have heard optimism.” A heatwave in France was the latest stage of unfavourable weather that has stressed EU crops.
Consultancy Strategie Grains forecast the EU wheat crop will fall to 123.3 million tonnes, down from 124.4 million projected in June from 129.9 million tonnes harvested last year.
Germany’s 2022 wheat crop will increase 5.3% on the year to 22.51 million tonnes, farm cooperatives said.
“The forecast is positive as an increase on the year is still seen despite concern about crop stress,” one trader said.
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