European wheat futures in Paris fell on Tuesday as weakness in US markets in Chicago and uncertainty over demand encouraged the market to pull away from a one-month high struck last week. Benchmark December milling wheat on the Paris-based Euronext exchange, was down 1.5 euros or 0.7% at 170.50 euros ($187.57) a tonne at 1542 GMT, after earlier touching 170.25 euros, its lowest in more than a week.
The contract was facing technical pressure following last Thursday's one-month high of 172.50 euros, dealers said. Traders said there was still concern that export demand was lagging in the wake of a big European Union harvest, despite recent weakness of the euro against the dollar and several new international purchase tenders by importers.
"We need a next round of demand, whether internally in the EU or on the export front, if prices are going to higher," one futures dealer said. Morocco remained a focus as the North African country was set to open its import season from October. French port data on Monday showed a cargo was loading 30,000 tonnes of wheat in Rouen bound for Morocco. But traders said French wheat could face stiff competition in Morocco from Black Sea origins such as Ukraine.
Widespread rain in France on Tuesday, forecast to be followed by more showers in the week ahead, was seen boosting prospects for upcoming wheat sowing after a prolonged dry spell, and offering relief to recently sown rapeseed. In Germany, slack demand along with slow farmer selling also continued to hang over the market.
"German wheat remains expensive compared to other exporting countries in the Black Sea and Baltic Sea regions," one German trader said. "We will have to wait until other exporters start to sell out their supplies for demand to switch to Germany." "The main nearby hope is that the weaker trend in the euro will make west EU wheat more competitive in export markets." Farmers remained reluctant sellers, still unhappy about prices, which remain well below their levels before this summer's harvest.
Comments
Comments are closed.