Paris wheat futures rose on Tuesday, supported by a steep drop in the euro and a broad bounce in financial markets after Monday's massive fall on fears over the impact from the coronavirus pandemic. Rapeseed, which bore the brunt of losses on Euronext's crop futures on Monday under pressure from tumbling oil prices, also rebounded.
Benchmark May milling wheat on Paris-based Euronext unofficially closed with a gain of 4 euros, or 2.2%, at 179.25 euros ($196.64) a tonne, approaching a chart resistance zone at 180-181 euros. The contract had fallen on Monday to near last week's six-month low of 174.25 euros.
"We're seeing a rebound in keeping with wider financial markets and with the drop in the euro," one futures dealer said. "For wheat there is still demand to cover for March with export loadings. But for April-June it's very hard to anticipate the market, it will depend on coronavirus measures." Euronext May rapeseed unofficially closed 9.25 euros, or 2.7%, up at 344.75 euros a tonne.
Rapeseed had fallen to touch a life-of-contract low at 330.75 euros a tonne on Monday, also the weakest spot price since late April 2018. A fire last week that brought a large French crushing plant in Rouen to a standstill had also clouded the demand outlook for rapeseed.
For the part of the site not touched by the fire, operator Saipol was aiming to restart oilseed crushing next week and biodiesel output the week after, subject to approval from authorities, a spokesman said. In Germany, cash premiums in Hamburg firmed as more demand was seen at current low price levels after Paris futures touched six-month lows on Monday.
Standard bread wheat with 12% protein for April delivery in Hamburg was offered for sale at about 7 euros over the Paris May contract, against 6 euros over on Monday. Buyers were offering about 6 euros over Paris. "The coronavirus crisis is causing enormous uncertainty but in the near term, demand is steady with a series of ships being loaded in German ports," one German trader said. Supplies were being sought to complete shipments of wheat exports in Germany.
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