PARIS: Euronext wheat futures slid to new contract lows on Thursday as an unrelenting decline in Russian prices heightened concerns that Europe’s large wheat stocks would face stiff competition in export markets.
May wheat, the most actively traded position on Paris-based Euronext, was down 1.6% by 1517 GMT at 205.75 euros ($221.24) a metric ton. It earlier hit a new life-of-contract low at 204.25 euros that also marked a weakest second-month price since July 2021.
Front-month March wheat was down 1.3% at 206.25 euros a ton, after setting a contract low at 205.00 euros. New-crop December futures also reached a fresh low for the contract at 218.00 euros.
“Russian wheat prices just won’t stop falling,” a futures dealer said. “Feed wheat is dropping sharply too because of strong competition from barley and corn.”
Traders said one major Russian analyst assessed prices for 11.5% Russian wheat for nearby shipment at $218 a ton FOB on Thursday, below the psychologically important $220 a ton level.
“This would be down between $7-$10 since the end of last week,” a German trader said. “Lower prices are being offered from Russia almost daily despite the Russian export price floor.”
Cheaper competition from Russian and also Ukrainian supplies was dampening western European prices as exporters chased limited short-term demand.
“We are still seeing continued selling pressure to reduce inventories meeting low importer demand,” the trader said. German wheat was attracting some demand within Europe, with traders citing interest from British mills for German bread wheat along with Dutch interest in German feed wheat.
Chicago wheat was down more than 1%, with a firmer dollar adding to pressure from the weak trend in international export prices. Grain market participants were awaiting the US Department of Agriculture’s (USDA) monthly US and world supply and demand outlook later on Thursday for further direction.
While the focus will be on corn and soybean forecasts, traders will be watching for revisions to global wheat supply.
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