European wheat futures extended losses on Thursday to hit an eight-month low as signs of a recovery in global supply continued to dampen prices. A near nine-month low for US wheat at the previous close in Chicago increased technical pressure on Paris futures, pushing them through another support level, traders said.
The market is now awaiting weekly US and European export data later on Thursday, and especially monthly supply/demand estimates from the US Department of Agriculture on Friday to see if the market can bottom out. "The USDA report will give the verdict for the market," a futures dealer said.
Benchmark May milling wheat on the Paris futures market was down 1.50 euros or 0.65 percent at 231.00 euros ($300) a tonne by 1315 GMT. It earlier touched the lowest level on the contract since July 2 at 230.50 euros, after breaching a support zone at 231-232 euros.
The United Nations' Food and Agriculture Organisation (FAO) on Thursday estimated that world wheat production would rise 4 percent in 2013 to 690 million tonnes, adding to expectations of more ample supply this year. India's decision to allow a further 5 million tonnes of wheat exports also reinforced the bearish fundamental tone by creating the prospect of more export competition. "The only bullish story left floating for wheat is the possible advance in deteriorating conditions of Southern Russia wheat, but this story has already been well flogged," brokerage INTL FC Stone Europe said in a note.
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