Paris wheat slips to 2-1/2 month low as harvest pressure weighs

PARIS: Euronext wheat fell to a 2-1/2 month low on Monday, curbed by weakness in US futures and the prospect of large crops in France and Germany where harvesting is in its latter stages.

Competition from the Black Sea region was also keeping a lid on shipments, with European Union soft wheat exports running 34% below the same period last season.

Benchmark December milling wheat on Paris-based Euronext settled down 1.00 euro, or 0.6%, at 177.50 euros ($199) a tonne, after earlier falling to its lowest since May 22 at 176.75 euros.

In France, where the harvest is winding down in northerly regions, market estimates were pegging the soft wheat crop at around 39 million tonnes, which would be the second-largest on record. to

The bumper production in prospect was raising questions as to whether France will be able export enough to clear stocks.

"France will need to export over 10 million tonnes of soft wheat outside the EU by June next year," consultancy Agritel said in a note.

"This is a real challenge that has been met before, either thanks to high demand or strong export competitiveness. For now, neither of these success factors are there, hence the downward pressure on prices."

In Germany, the harvest was repeatedly interrupted by rain over the weekend and on Monday in the final areas to be cut in the north and northeast of the country.

There is still a considerable volume to be harvested in the north and northeastern regions of Schleswig-Holstein and Mecklenburg-Vorpommern, both major producers for Germany's wheat exports.

"The forecasts for north Germany this week are for continued unsettled weather and again with showers, so we will just have to wait and see if the weather is good enough to gather the final areas," one trader said.

"I think the wheat may be able to shake off the late rain without major quality loss if there is a dry spell."

Standard bread wheat with 12% protein for September onwards delivery in Hamburg was offered for sale unchanged at 3.0 euros under Paris December. Buyers were seeking at least 4.0 euros under.

Traders said farmers were unwilling to sell at current depressed Paris levels. Selling of new crop wheat from Poland was also noted in the Berlin region.