European wheat futures in Paris rose on Tuesday, responding to traders adjusting positions in the front-month futures contract before its expiry, gains in US prices in Chicago and concerns about a dry crop conditions. May milling wheat on the Paris-based Euronext exchange, the last delivery position for the 2016 harvest, unofficially closed up 1.75 euro or 1.1 percent at 164.50 euros ($180.00) a tonne.
Some market participants were exiting positions ahead of the expiry of the contract on the May 10, with a market closure on May 1 and an additional public holiday in France on May 8 encouraging shorts to remove risky positions, traders said. New crop prices steadied after an earlier fall, helped by higher Chicago futures during Tuesday's US session.
Paris new crop September wheat unofficially ended up 0.25 euro or 0.1 percent at 166.75 euros.
The export-punishing strength in the euro was limiting price gains, one Euronext trader said. Dry weather in past weeks has been causing concern about possible damage to EU wheat plants.
"But at the same time, whenever there is a price fall there is interest from consumers while sellers are worried about the impact of drought," he said.
In Germany, cash market selling premiums in Hamburg followed the Paris strength, but the strong euro dampened prospects for new overseas sales. The euro rose after centrist Emmanuel Macron won the first round of France's presidential election.
Standard wheat with 12 percent protein content for April delivery in Hamburg was offered for sale 2 euros higher at 8 euros over the Paris May contract. Buyers were seeking 7 euros over. "The strength of the euro against the dollar is a great disappointment for export prospects," one German trader said. "Rain in parts of Germany is reducing fears about dryness damage while late winter frosts seem more of a threat to rapeseed than wheat."
Comments
Comments are closed.