Paris wheat futures higher after six-week low

Paris wheat futures edged higher in light trade on Tuesday to come off a six-week low, as a bounce in Chicago and wider commodity markets offset supply pressure from an advancing European harvest. December milling wheat, the most active contract on Euronext, was up 1.50 euros or 0.8 percent at 183.75 euros a tonne by 1536 GMT. On Monday the contract had touched its lowest since June 22 at 181.75 euros.
European prices took their cue from US wheat which pulled back from a six-week low, although gains petered out in US trading as ample global production and stiff export competition continued to hang over the market.
Crude oil and other commodities also steadied after heavy losses linked to worries about the Chinese economy.
Traders said latest estimates calling for a record-large French wheat harvest, supported by good yields in the north where field work is continuing, would keep a lid on prices.
"The short-term trend remains bearish given the lack of competitiveness of French wheat in export markets, and with harvest estimates rising after good yields reported in the north along with quality that is satisfactory albeit a little uneven, a Euronext trader said.
Traders were now generally expecting a soft wheat crop of 39-40 million tonnes, surpassing a record 38.2 million seen in 1998 and well above estimates during a dry, hot spell in the run-up to harvesting.
In a sign of slack export demand, Senalia, which operates a silo at the northern port of Rouen that is also a delivery point for wheat traded on Euronext, suspended on Tuesday inflows of milling wheat.
France faces competition from Black Sea exporters Russia and Ukraine, as well as other EU origins.
In Germany, new crop standard wheat with 12 percent protein content for September delivery in Hamburg was offered for sale at an unchanged 2 euros over the Paris December contract. Buyers were seeking an unchanged 1 euro over Paris.
Showers in some areas were again interrupting the German harvest after rapid progress since Friday.
"I think the market is awaiting the picture of quality from this year's crop which is not clear yet although quality looks like being reasonable," one German trader said.