Business World

Tuesday 21 November 2017

Russia extends wheat export ban

Catherine Hornby

Wheat prices in Europe ended higher yesterday, tracking gains in Chicago, after Russia's Prime Minister Vladimir Putin said that a ban on grain exports could extend beyond December 31, traders said yesterday.

After falling heavily at the open, Paris wheat moved into positive territory amid continued uncertainty over the situation in Russia and the rest of the Black Sea region, as well as technical support that kept Euronext prices above the key €200 threshold.

Markets were boosted by strength in Chicago wheat futures after Mr Putin said Russia's grain export ban may be extended beyond December as a fall in this year's crop could be worse than expected due to a severe drought.

Operators remained cautious as they awaited Thursday's supply and demand report from the US Department of Agriculture, which will be watched for revised estimates of Russian wheat, as well as for US wheat and corn.

"The market is looking a bit steadier but there is a lot of caution," one futures broker said.

Benchmark November milling wheat BL2X0 on Euronext rose €3.75 to €213.25 a tonne, after falling as low as €203.00 in early trade to approach major psychological support at €200.

A near-term technical support level at €205 was also underpinning the market, traders said.

The benchmark contract fell 6pc last Friday as news that Russia would review its export ban in October encouraged profit-taking after a rally that had taken the contract to a high of €236 last Thursday.

Paris futures also drew some support on Monday from news that Egypt bought 240,000 tonnes of French wheat in a weekend tender, in a first sign of European grain benefiting from Russia's extended export freeze.

Irish Independent

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