European wheat prices rose on Wednesday, boosted by a sharp rise in Chicago and a slump in the value of the euro against the dollar, while traders struggled to assess the impact of the coronavirus crisis on global grain demand.
Benchmark May milling wheat on Paris-based Euronext, was up 1.8% by 1636 GMT to 182.50 euros a tonne.
"There seems to be a fear of supply disruption due to COVID-19. There is also some support from the weaker euro," one trader said.
The dollar surged across the board on Wednesday, hitting multi-year highs against several major currencies, as companies and investors worried by the coronavirus outbreak rushed to the perceived safety of the US currency.
The slump in the euro helps euro-denominated grains, such as French and German origins, to be more competitive on export markets.
The US wheat market was led higher by a nearly 3% gain in K.C. hard red winter wheat futures, which stemmed from rising demand for pasta and baked goods as consumers are forced to eat at home because of coronavirus.
In Germany, cash premiums in Hamburg were stable as near-term export demand continued.
Standard bread wheat with 12% protein for April delivery in Hamburg was offered for sale unchanged at around 7.0 euros over the Paris May contract. Buyers were offering around 6.0 euros over Paris.
"Ports remain busy loading wheat for export so supplies are being called up to load ships," one German trader said. "This is supportive but overall the market remains in a state of massive uncertainty with the impact of coronavirus the number one theme."
Germany has gone a long way towards shutdown with most shops closed along with schools, restaurants and cafes, but with no restrictions on public movement.
"The overall impact of the coronavirus is still impossible to calculate but the economic outlook looks black," the trader added. "The market is still trying to calculate what it all will mean." "Food such as bread and noodles are a basic requirement and are being bought heavily by the public."