EU wheat falls for second session to near two-week low

Arnaud Caron, a French farmer drives an old Mc Cormick F8-413 combine, next to modern Claas 660 Lexion combine, as he harvests his last field of wheat, in Vauvillers, northern France. REUTERS/Pascal Rossignol
Arnaud Caron, a French farmer drives an old Mc Cormick F8-413 combine, next to modern Claas 660 Lexion combine, as he harvests his last field of wheat, in Vauvillers, northern France. REUTERS/Pascal Rossignol
FILE PHOTO: Combines harvest wheat in a field near the village of Kruglolesskoye in Stavropol region, Russia June 26, 2018. REUTERS/Eduard Korniyenko/File Photo

Valerie Parent and Michael Hogan

European wheat prices fell for a second session on Wednesday on technical elements and following a fall on U.S. markets due to easing concerns about potential crop damage.

Front-month September milling wheat on Paris-based Euronext, was down 1.6pc by 1530 GMT to 179.50 euros a tonne after hitting a nearly two-week low of 178.75 euros.

That was 6pc lower than the 190 euros touched when the recent weather-related rally reached its peak on May 29.    

Widespread rainfall on nearly all of mainland France, Germany and the UK and a lack of international buyers also weighed on prices, traders said.

"Soil moisture is improving which is rather welcome after the relative drought of these last weeks," one said. "At global level the situation looks rather comfortable in terms of volume for wheat," he added.

Wheat futures on the Chicago Board of Trade dipped to near a one-week low on Thursday, as fears eased about potential rain damage to crops and world markets continued to take profits from the recent rally.

In Germany, cash premiums in Hamburg were little changed as rain improved the outlook for the new crop.

Standard bread wheat with 12pc protein for September onwards delivery in Hamburg was offered for sale flat at 2 euros under Paris December. Buyers were seeking at least 4 euros under.

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Germany's 2019 wheat harvest will increase 21.9pc on the year to 24.70 million tonnes as crops benefit from recent rain, the country's association of farm cooperatives said on Wednesday.

"There has been German farmer selling in past days as high Paris prices were attractive," one German trader said. "There was heavy rain in Germany on Tuesday and although more rain is needed, our crops are looking in good shape."

"Germany is facing a larger harvest but the trouble is that so are Germany’s rivals like Russia and Poland."

This meant exporter demand for new crop German wheat was low with cheaper prices being offered in international markets by east European exporters.

But old crop wheat exports remained brisk, with a series of shipments loading. One ship is set to load about 55,000 tonnes of wheat in Germany for South Africa in late June, he said.

Reuters


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