PARIS: European wheat futures rose sharply on Friday as concern grew over forecasts for continuing dry weather in top wheat exporter Russia.
Torrential rains in southern Brazil, which are threatening late losses to corn and soybean harvests there, were also supporting grain markets, traders said. September wheat, the most active position on Paris-based Euronext, was up 3.5% at 235.75 euros ($253.90) per metric ton by 1506 GMT, equalling a four-month peak from last Friday. Chicago wheat jumped over 4% in US trading as weather worries and a weaker dollar fuelled gains.
“The market has a big focus on Russian weather as we go into the weekend,” a German trader said. “The forecasts for south Russian wheat regions are now very dry for the next week and harvest forecasts are being cut.”
Russian consultancy IKAR said on Friday it had cut its forecast for Russia’s 2024 wheat crop to 91 million metric tons from 93 million tons. Weather charts were showing very little rain for southern Russian wheat belts in the coming two weeks, raising the risk of sharper revisions to harvest forecasts as crops enter key yield-determining stages.
The price rally was also thought to have limited the volume booked by Algeria in a wheat import tender. The country’s state grains agency OAIC was believed to have made a relatively small purchase of between 240,000 and 300,000 metric tons on Thursday, traders said. Negotiations were said to have continued on Friday but without leading to further purchases.
“The market has taken off with the weather issues in Russia, so it makes sense for Algeria to wait now,” another trader said. Estimated prices from the tender suggested Russian and other Black Sea origins were best placed to fill the order, though traders noted the absence of some Russian merchants following recent administrative delays to cargoes in Russia.
In France, the condition of soft wheat crops was stable last week, holding at a four-year low, data from farm office FranceAgriMer showed.
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