PARIS: European wheat edged higher on Wednesday, supported by continued strong demand, but prospects that some grains could come out of Ukrainian ports pressured prices after the centre in Istanbul to oversee exports was launched as planned.
Benchmark December milling wheat on Paris-based Euronext closed 0.1% higher at 327.25 euros ($330.59) a tonne.
Russia and Ukraine signed a deal, brokered by Ankara and the United Nations, on Friday to reopen grain and fertiliser exports that have been blocked by war to ease an international food crisis.
Some doubts remained that a safe sea shipping corridor could become operational soon against continued expectations of strong export demand for EU wheat.
“The reports today spoke of a start to the shipping corridor within days, which would bring new supplies onto the market quicker than thought earlier this month,” one German trader said.
“Vessel owners will want to get ships stuck in Ukraine out the country quickly and they will no doubt sail with grain cargoes. The question is whether ships will go back to Ukraine to pick up more cargos if attacks continue on ports.”
“So I think strong export demand for EU wheat could continue for the immediate future until it is clear that ships will go back to Ukraine in large numbers.”
Pakistan is considering offers this week in a tender for 200,000 tonnes of wheat after traders said much of Pakistan’s purchase of 300,000 tonnes last week was expected to be sourced in France.
“There is talk that China’s recent wheat purchases in Europe involved about 400,000 tonnes of French wheat,” another trader said.