PARIS: wheat eased for a second session on Wednesday as French supply and demand forecasts and expected competition in an Algerian tender underscored lagging exports.
The market was also assessing differing reports about Russian military activity near Ukraine, after Tuesday’s announcement by Moscow of a withdrawal of some troops following drills.
March wheat on Euronext settled down 3.75 euros, or 1.4%, at 263.00 euros ($299.22) a tonne.
Around the end of the Euronext session, traders reported that Algerian state buyer OAIC had begun purchasing wheat in its tender.
A sale price of around $345.50 a tonne, cost and freight (c&f), cited by traders supported expectations that French wheat would face stiff competition from Black Sea region supplies.
Earlier on Wednesday, farm office FranceAgriMer lowered its forecast of French 2021/22 soft wheat exports outside the European Union for the fourth month in a row, citing stalled sales to Algeria.
A diplomatic row between Paris and Algiers, rain-affected quality in the last French harvest and a push by Algeria to attract other wheat suppliers have combined to cut France’s market share this season.
However, French shipping data showed one vessel is due to load around 13,000 tonnes of wheat for Algeria in the coming days, suggesting French wheat will claim part of OAIC’s previous tender purchase.
French port data also showed a vessel is due to load wheat for Egypt, following a sale of French wheat in an Egyptian tender in late December.
Traders are watching to see if French wheat will claim further sales to Egypt this season. The country’s supply ministry said on Tuesday a new tender would be issued next week.
In Germany, standard 12% protein wheat for February onwards delivery in Hamburg was offered for sale at about 13 euros over Euronext March.
German cash markets were seeing stronger demand from European flour mills rather than new export sales, traders said.
“We are seeing repeated demand from flour mills not only in Germany but also from mills in countries including Britain, Spain and Portugal,” one German trader said.
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