PARIS: Euronext wheat futures extended gains on Wednesday to a three-week high as concern that adverse weather will reduce harvest yields and quality in France and elsewhere in Europe remained the centre of attention.
December milling wheat, the most active position on Paris-based Euronext, settled 1.00 euro, or 0.5 percent, higher at 186.50 euros ($217.46) a tonne.
It earlier rose to 187.00 euros, its highest since June 13.
Volumes were light as a market closure in Chicago for US Independence Day reduced activity, but traders said the European harvest focus helped Euronext to pursue its rally.
A steep cut to its French crop forecast by consultancy Strategie Grains has unsettled the market since last week, deepening concern about weather-related losses in Europe.
"With no consensus at the moment on the size of the harvest, the European market is continuing to climb," a French trader said. "The lack of sellers is also supporting the trend."
Some market participants remained sceptical about Strategie Grains' 33.2 million forecast for France's soft wheat crop, 4.6 million below its previous estimate, but harvest projections were generally being trimmed.
Storms moving across France from the southwest on Tuesday were adding to harvest uncertainty.
Torrential rain could slow wheat harvesting that got off to a very early start in late June and force the market to wait longer for clearer results on yields and quality, traders said.
Euronext also found support in news that Algeria, the largest overseas buyer of French wheat, made a large purchase of 660,000 tonnes in a tender.
The optional-origin purchase for September shipment was most likely to be sourced from France, although traders said US wheat was a possible origin for some of the volume after a recent price fall.
Non-commercial market participants reduced their net long position in Euronext's milling wheat futures and options for a third week in a row in the week to June 29, data published by Euronext showed.
The European Union this week awarded 10,150 tonnes of reduced-tariff wheat imports under its main quota open to all origins apart from the United States, official data showed.
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