EU wheat boosted by strong exports

European wheat prices edged higher on Thursday supported by strong exports even though the euro was firm against the dollar, European traders said. March milling wheat on Paris-based Euronext was 0.44 percent higher by 1704 GMT at 169.75 euros a tonne. In Chicago prices were also firm. Algeria bought 585,000 tonnes of optional-origin milling wheat in a tender that closed on Wednesday with prices ranging from $203 and $207 a tonne, cost and freight included, for a shipment in April, traders said.
Origins were likely to include US hard red winter (HRW) but a significant volume could come from the European Union, including France, Germany and Baltic countries, traders said. The market was supported by weekly export data that showed 515,000 tonnes of wheat have been exported in the past week, the highest volume since November 1, 2016. This was when the EU changed its reporting system for grain exports and imports, which are now based on actual shipments and no longer on licences requested.
In Germany, cash market premiums in Hamburg were stable, supported by stronger purchase interest. Standard wheat with 12 percent protein content for February delivery in Hamburg was offered for sale unchanged at 5.5 euros over the Paris March contract, buyers were seeking 5.0 euros over against 4.5 euros over on Wednesday.
"There is hope that some of the 585,000 tonnes of wheat purchased by Algeria in its tender on Thursday will be sourced in Germany but several French trading houses appear to have been awarded a large share of the sales in the tender," a German trader said.
"This makes you suspect that a lot of the Algerian purchase could be sourced in France." But there is optimism Germany could be a major source country for a tender for 1.5 million tonnes of feed barley issued by Saudi Arabia on Thursday. Rising water levels on the Rhine and Danube rivers were also making logistics easier after the past two months when shallow water had prevented ships sailing fully loaded.
"Central and northern sections of the Rhine are still too shallow for full shiploads but the situation is improving at last," the trader said. "The south section of the Rhine and also the Danube are now deep enough to allow full vessel loadings."