European wheat prices rose on Monday, supported by a strong US market and further dry weather in Europe but trade was light due to a lack of international demand linked to strong competition from Black Sea origins. December milling wheat, the new-crop benchmark on Euronext, was 2.25 or 1.25 percent higher by 1548 GMT to 182.50 euros a tonne.
"The market continues to monitor the weather, notably the impact of dry weather in France which cuts crops' yield potential, but there is no real anxiety," one trader said. "It would take a real problem somewhere for buyers rush in, which then would create a strong movement because many are short." July wheat on the Chicago Board of Trade was 2.8 percent higher at $5.02-1/4 a bushel.
The European Union's crop monitoring service on Monday lowered its forecast for the soft wheat yield in this year's EU harvest, to 5.85 tonnes per hectare (t/ha) from 5.93 t/ha estimated last month, due to adverse weather conditions. The yield is now 4.7 percent down on last year when the EU harvested a record crop but remained 3.3 percent above the five-year average.
Northern France saw some rainfall on Monday afternoon but weather forecaster Meteo France predicted dry weather in the next 10 days, apart from a few showers on Saturday afternoon in the north-east. First winter barley harvests, which started last week in western France, showed good quantity and quality, brokers said. In shallow soil in the Charentes and Charente-Maritime regions, operators saw yields of around 6/7 tonnes per hectare (t/ha) while these would climb to 9 t/ha in deep soils.
German cash wheat premiums in Hamburg were little changed, with rain helping to relieve parched German wheat but with a lack of farmer selling at current relatively low price levels supporting. Standard wheat with 12 percent protein content for June delivery in Hamburg was offered for sale at an unchanged 1 euro over the Paris December contract. Buyers were offering 0.5 euros under Paris.
New crop for September delivery was offered for sale at 4.5 euros over Paris December, with buyers at 3.5 euros over. "There has been welcome rain in Germany over the weekend and on Monday and more is forecast up to Friday which will be positive for wheat," one German trader said. "But the rain came too late to prevent some crop forecasts being downgraded."
"Farmers are very reluctant sellers as current outright prices are seen as too low." "The export sector is also becoming more quiet after the large number of ships loaded in past months, with the Black Sea region the most competitive." Port vessel line ups for Hamburg showed one ship to sail with 53,000 tonnes of wheat for Yemen and one for 40,000 tonnes for South Africa. In the port of Rostock, one ship will sail with 40,000 tonnes to Nigeria, one with 25,000 tonnes to Yemen and another is set to load 40,000 tonnes for Iran.
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