PARIS: Benchmark wheat prices on Euronext edged up on Friday to post a weekly gain as short-covering after recent lows offset a poor export outlook, traders said.
December wheat, the most-active position on Paris-based Euronext, settled 0.1% higher at 218.75 euros ($242.31) per metric ton. The contract was up 1% over the week after hitting a new three-week high at 222.50 euros during Friday’s session, but again failed to hold above 220 euros as it faced chart resistance.
“Speculative short-covering has provided buying interest, although the primary negative wheat price driver remains in play,” British merchant Frontier Agriculture said in a note.
“Russian wheat prices remain close to their lows - below $220/t FOB - as the world’s largest wheat exporter continues to dominate trade.” Competition from cheaper Black Sea supplies has deflected attention from poor harvests in France and Germany, the EU’s top two wheat producers.
Russian 12.5% protein wheat was on Friday quoted little changed at about $215-$217 a ton FOB for September/October Black Sea shipment, Romanian 12.5% was higher at around $232-$236 a ton FOB, which was still about $20 a ton cheaper than German.
Ukrainian feed wheat was also being discussed for nearby delivery at about 206 to 210 euros a ton in north Germany and 204-212 euros in the Netherlands, traders said.
“The low prices offered from the Black Sea means Germany and France are basically out of the export market. It is not only Russia and Ukraine which are so cheap, it is also others like Romania and Bulgaria,” a German trader said. “Black Sea markets are hardly rising despite the Euronext strength, which is opening up a big gap in prices.”
Mixed harvest quality, on top of low yields, was also curbing French and German export prospects. Updated results on this year’s rain-hit French soft wheat crop showed test weights were slightly better than previously estimated but still mostly below common market standards.
Chicago wheat, corn and soybean futures eased after gains this week, with attention turning towards US government crop forecasts next week. September wheat on Euronext ended down 2.3% at 199.00 euros as participants exited positions before Tuesday’s expiry of the front-month position.
In oilseeds, November rapeseed on Euronext fell 2% to 464.00 euros, pressured by losses in mineral and vegetable oil markets.
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