European wheat prices turned lower on Thursday as the market digested a monthly report issued by the US Department of Agriculture which also triggered losses in Chicago. The government report put US wheat ending stocks at 955 million bushels for 2018/19 and 1.070 billion bushels for 2017/18, both of which were above the average of analysts' estimates.
Benchmark December milling wheat on the Paris-based Euronext exchange was down 0.50 euros, or 0.3 percent, at 175.75 euros a tonne at 1640 GMT, well below a session high of 177.25. Dealers said a public holiday on Thursday in several countries including France and Germany helped to limit market participation and activity should remain subdued on Friday. An improving outlook for crops in the European Union also helped to weaken prices.
Cereal crops in the EU are generally in good shape, partly reflecting improved conditions in Spain after drought last year, but grain belts in the east of the bloc could suffer if hot weather continues, Strategie Grains said. "An improvement to crop conditions in Spain is now confirmed, whilst good yields are also on the horizon for France and Italy," the French analysts said in a monthly report. Strategie Grains also maintained its outlook for a sharp drop in European Union soft wheat exports in 2017/18 on Thursday, while also scaling back its expectations for a rebound next season.
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