Euronext wheat was little changed on Thursday as support from concerns about the weather and covering of positions before the expiry of May futures was offset by ample global supplies and a move by Morocco to effectively halt imports. May milling wheat on the Paris-based Euronext exchange, the last delivery position for the 2016 harvest, settled unchanged on the day at 167.25 euros a tonne.
Market participants have been closing short positions ahead of the expiry of the position on May 10 to avoid physical delivery requirements, with a holiday closure next Monday adding urgency, according to dealers. New-crop September on Euronext also ended flat, at 168.25 euros. "Producers aren't selling because they're monitoring the weather. There is still a bit of cold to come and some rain is expected, but will it be enough?," one futures dealer said. "At the same time, the weather problem is rather limited to France and on the demand side Morocco, a major customer for EU and Black Sea wheat, has announced a prohibitive import tariff due to the good harvest expected there."
Morocco has raised its soft wheat import custom tax to 135 percent from 30 percent until December 31, the government said on Thursday, the highest rate in years thanks to strong harvest and low international prices. Weekly European Union data showed soft wheat exports so far in 2016/17 had reached 20.3 million tonnes by April 25, down 18 percent from a year ago.
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