European wheat prices hit fresh contract lows

European wheat prices hit fresh contract lows on Friday following a sharp fall in Chicago as ample global supplies continued to weigh on sentiment on both side of the Atlantic. Benchmark December milling wheat on Paris-based Euronext was 0.6% lower by 1548 GMT at 168 euros ($187.22) a tonne after setting a contract low of 167.50 euros.
"In wheat it's all good everywhere, there is no reason for prices to go up," a trader said, adding that the next technical support was at 166 euros a tonne.
A lack of export demand was also weighing on prices, traders said, saying one cargo of French wheat sold to Egypt this week, the first of the season, was not enough to relieve hefty supplies in the EU's largest wheat producer.
On the cash market, brokers noted reluctance to sell at these low prices.
In Germany, there were hopes the euro's weakness will improve the west EU's competitiveness in world markets with euro zone exports still regarded as running too slowly to clear inventories expanding after this summer's large crops.
"Germany's export chances currently remain depressed with other exporters in the Baltic Sea and Black Sea regions taking the most early season business in international markets," one German trader said.
"The German and west EU wheat harvests are large and we need EU wheat exports to rise to much higher tonnages if supplies are not to become burdensome."
Standard bread wheat with 12% protein for September onwards delivery in Hamburg was offered for sale at 0.5 euro under Paris December to level Paris against 1.0 euro under on Thursday. Buyers were seeking at least 2 euros under Paris.
In the export sector for 12.5% protein supplies, Lithuanian wheat was offered for sale at around 0.5 euro over Paris for September delivery to the port of Klaipeda while 12.5% wheat in German ports was offered at 2.0 euros over Paris.
"Lithuania has been making the running in early season exports and is still a lot cheaper," another German trader said. "I estimate Lithuania has loaded about 400,000 tonnes of wheat exports so far in August, about twice Germany's loadings, including big shipments to Saudi Arabia and South Africa."
Feed wheat futures in London were lower with November down 0.6% at 131.00 pounds a tonne.
The Agriculture and Horticulture Development Board (AHDB) estimated in a report on Friday that UK wheat harvest was 79% complete with yields 6% to 8% above average. The AHDB estimated the UK wheat crop would be the largest since 2015 at between 15.9 million and 16.2 million tonnes.