Paris wheat dips after USDA forecasts, Egyptian tender result awaited

• US Department of Agriculture (USDA) world supply and demand reports issued close to the end of the European session were regarded as generally within market expectations,
• March milling wheat, the most active contract on the Paris-based Euronext exchange, unofficially closed down 0.50 euro, or 0.2%, at 182.75 euros ($201.43) a tonne.

HAMBURG: Paris wheat futures edged lower on Tuesday as markets reacted calmly to US government crop forecasts, while traders waited to see if French wheat would pick up an export sale in a purchase tender being held by Egypt.

US Department of Agriculture (USDA) world supply and demand reports issued close to the end of the European session were regarded as generally within market expectations, with no major surprises.

March milling wheat, the most active contract on the Paris-based Euronext exchange, unofficially closed down 0.50 euro, or 0.2%, at 182.75 euros ($201.43) a tonne.

It earlier eased to 182.50 euros, its lowest in nearly two weeks, but held chart support around that level.

Euronext December closed down 4.25 euros, or 2.2%, at 181.00 euros a tonne on the last day of trading as dealers exited trading positions on the contract.

French wheat was seen as in contention to pick up part of any purchase by Egypt in Tuesday's tender after being offered the cheapest before shipping costs. Tender results were still awaited as Paris closed.

"It's going to be interesting to see if Egypt buys some French wheat," one trader said. "It looks like French wheat is still competitive."

In France, traders were monitoring the latest wet spell, which could bring further rain delays to autumn sowing, and a continuing rail strike amid protests against pension reform.

In Germany, cash premiums in Hamburg remained well supported as supplies were called up for ship loading for export in German ports.

Standard bread wheat with 12% protein for January delivery in Hamburg was offered for sale unchanged at 3 euros over the Paris March contract. Buyers were offering around 2 euro over Paris.

"German port loadings are still at a high level, although down from their peak level a few weeks ago," one German trader said. "Black Sea competition remains heavy but it was good to see French wheat the lowest offer in FOB terms in the Egyptian tender today."

In past days, ships loaded in Germany included a vessel with 30,000 tonnes of wheat for Guinea, 60,000 tonnes for Sudan and 30,000 tonnes for Mozambique. Another large ship is due to load wheat in Germany for central Africa in the coming week.

"Africa and Saudi Arabia remain the largest export customers for German wheat although there was even a rare shipment of 35,000 tonnes from Germany to Turkey in late November," another trader said.