PARIS: Euronext wheat fell sharply on Wednesday in step with Chicago as weak chart signals fuelled a further pullback from last month’s highs.
March milling wheat on Euronext settled down 8.50 euros, or 3.0%, at 275.75 euros ($310.58) a tonne.
The contract broke support around 280 euros that had been tested on Tuesday, pressured by the breaching of chart levels in Chicago.
The Paris benchmark fell to a seven-week low of 274.25 euros before recovering slightly to hold support at 275 euros, traders said.
Wheat futures have retreated since last month’s record peak on Euronext and nine-year high in Chicago, as worries over the Omicron coronavirus variant and easing concerns about global wheat supply have encouraged selling.
Financial investors trimmed their net long position in Euronext wheat last week, data published by Euronext on Wednesday showed.
After a wave of activity from importers helped wheat futures to steady at the start of the week, export sentiment was cooled by the outcome of Algeria’s tender.
Traders said Algeria booked around 700,000 tonnes in the tender on Tuesday, with traditional supplier France widely expected to miss out for a second straight tender.
“The market debate today was certainly around what is Algeria’s policy towards French wheat,” one German trader said. “Algeria seems to be taking a course which will reduce the domination of French wheat in its imports.”
Algerian grain agency OAIC retained tender terms adopted in its previous tender that favoured Black Sea origins, with Ukrainian seen as likely to be used for part of the new order after a large sale of Russian wheat last time.
South American wheat was also expected to be supplied, while among European Union origins German and Swedish supplies were seen as in contention.
Reports that Russia may impose a smaller wheat export quota than previously planned failed to support prices, with traders noting a moderate potential adjustment.
In Germany, standard 12% protein wheat for January onwards delivery in Hamburg was offered for sale at around 9 euros over Euronext March, with exporter purchase interest seen at around 8 euros over.
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