Wheat prices in western Europe were higher on Wednesday in a continued rebound after bullish US Department of Agriculture (USDA) supply and demand data the previous day. "This report confirms that demand for agricultural products on the international market remains steady despite a financial crisis on state debt which could thwart fundamentals," French analyst Agritel said.
By 1240 GMT, benchmark November on Euronext milling wheat futures was 2.1 percent higher at 195.50 euros a tonne. The contract traded as low as 185.00 euros on Tuesday. Dealers continued, however, to keep a close watch on the deepening debt crisis in Europe. The euro recovered from a four-month low against the dollar on Wednesday as the focus shifts to an emergency summit of EU leaders expected on Friday.
German wheat prices were firmer, following a rise in Paris. Standard B-Wheat (bread-quality) wheat for September 2011 delivery in Hamburg was offered for sale up three euro at 200 euros a tonne. Buyers were offering 195 Euros a tonne. "The demand for export is low," one German trader said, adding the quality of this year's harvest in Germany could be key to making sales.
"Good German quality wheat we can sell for example to the mills in South Africa," one trader said. Feed wheat futures in London were also higher with November up 0.50 pounds or 0.3 percent at 162.00 pounds a tonne. Dealers noted the recent dry spell had diminished prospects for this year's UK wheat crop which will begin to be harvested in late July.