Paris wheat futures edged up on Thursday to stay near this week's one year highs as strong export demand and firm prices in top exporter Russia continued to underpin the European market. March milling wheat, the most active contract on the Paris-based Euronext exchange, settled up 0.50 euros, or 0.3%, at 196.25 euros ($217.72) a tonne.
In the previous session, it had climbed to 199.75 euros, a new high for the contract since August 2018 and a highest spot price since last February, before facing selling pressure near the psychological 200 euro level.
Chicago wheat futures have also touched their highest level in over a year, while Russian export prices have traded at season highs as wheat markets have been buoyed by purchases by importers, a proposal by Russia's government to cap grain exports and logistical snags in France due to strikes.
After Algeria, the main export outlet for French wheat, bought around 400,000 tonnes of wheat this week, a barley tender called by Saudi Arabia to buy 900,000 tonnes added to a backdrop of strong overseas demand for cereals.
"Short-term, demand isn't going away, and prices will stay supported," British merchant ADM Agriculture said in a note. The Saudi barley tender was seen as too large for a single origin to ship, with traders seeing scope EU supplies to win sales alongside competitive Black Sea origins.
Traders were monitoring the impact of a three-day walkout by port workers in France that started on Wednesday, which could exacerbate logistical problems after month-long rail strikes against pension reform.
In Germany, the potential for some export loadings to be switched from France was reinforcing favourable export prospects.
"With Black Sea wheat prices remaining high we are seeing more export demand in Germany with enquiries about German wheat for shipments up to March and April," one German trader said.
Standard bread wheat with 12% protein for February delivery in Hamburg was offered for sale unchanged at 4.5 euros over the Paris March contract. Buyers were offering up to 3.5 euros over Paris. Traders said they are receiving more enquiries about German 11.5% protein sales to replace French supplies.
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