European wheat prices fell on Thursday in cautious trade ahead of a meeting on the fate of Russia's export tax on the grain, shrugging off good weekly export data seen as necessary to clear last year's hefty crop, traders said. By 1654 GMT front-month March on the Euronext milling wheat futures was down 0.75 percent to 164.50 euros per tonne. It fell as low as 164.00 euros in earlier trade, not far from a contract low of 163.25 euros a tonne.
"We are still lacking support elements on the old crop (contracts) and there is no weather concern to support the new one," a Euronext trader said. Operators' attention was focusing on a meeting scheduled in Moscow on Friday to discuss on a possible change in Russia's wheat export tax, which traders hoped would bring more clarity to the market. Wheat rose to a 2-week high in Europe and a one-month high in Chicago this week on talk of tighter export curbs by Russia, but Moscow later tempered the speculation, saying it would discuss removing or cutting the tariff at a meeting with Deputy Prime Minister Arkady Dvorkovich, who oversees agriculture.
German cash premiums in Hamburg were little changed with more information awaited about Russia's grain export policy. Standard wheat with 12 percent protein content for February delivery was offered for sale unchanged at 3 euros under the Paris March contract. Buyers were offering 3.5 euros under Paris. "First reports were that Russia wants to restrict wheat exports and then it was said that Russia wants to help increase exports," one German trader said. "The market remains confused about what this huge wheat exporter will do."
"Overall, the market remains subdued with winter damage to crops not currently feared and some estimates that 50 percent of the 2015 harvest is still being held by farmers in north Germany. German wheat exports are gathering a bit more speed but the pace remains modest compared to last year and there are growing doubts whether the large old crop stocks in Germany can be cleared before the new crop."
Current wheat shipments in German ports include 20,000 tonnes for Libya, 50,000 tonnes for Oman, 33,000 tonnes for Guinea and 25,000 tonnes for Mauritania, traders said. Iran's agriculture minister said during a visit to Paris on Thursday the country aimed to be self-sufficient in wheat in the future by improving yields but will continue to be reliant on imports for maize and barley.
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