PARIS: Euronext wheat fell for a second day on Wednesday, retreating further from a three-month high, as a tender purchase by Algeria underscored competition from Russian supplies despite an escalation in Moscow’s war with Ukraine.
Paris futures were also tracking weakness in Chicago, where wheat prices similarly moved away from a three-month high in adjustments before closely watched US government crop forecasts.
December milling wheat on Paris-based Euronext was down 0.7% at 353.50 euros ($343.04) a tonne by 1531 GMT. The filling of a chart gap created during Monday’s rally added downward technical pressure, dealers said.
Algeria was thought to have bought around 500,000 tonnes of wheat in an import tender on Tuesday, with prices suggesting Russian wheat and other Black Sea origins would cover most of the volume.
“Looking at the prices, I think there is pretty strong market belief that Russian wheat will dominate the purchase by Algeria,” one German trader said.
“This is not a good sign for EU export demand if Russia is able to continue taking a big share of the Algerian market.” Worries about the Ukraine war getting worse have been tempered by expectations that a UN-backed shipping corridor for Ukrainian grain could be maintained, as well as Russia’s comments that it could abolish an export quota.
In France, farm office FranceAgriMer slightly increased its forecast for French soft wheat exports outside the European Union in 2022/23, but said the war in Ukraine made the outlook uncertain.
In Germany, a busy programme of ship export loadings in German ports continued to underpin premiums, but in thin trade.
Sellers of standard 12% protein wheat for October delivery in Hamburg were seeking a premium of about 14 euros over the Euronext December contract against 9 euros over last week.
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