Euronext wheat rose to a one-week high on Thursday, buoyed by a rebound in Chicago and an upturn in French exports. Gains were capped, however, by favourable prospects for this year's harvest and signs of persisting export competition from Black Sea origins in a Turkish tender, traders said.
Benchmark May milling wheat on Paris-based Euronext, settled 2.25 euros, or 1.2 percent, higher at 187.75 euros ($212.14) a tonne. It earlier rose to 188.50 euros, its highest since March 6, although dealers stressed the contract had yet to overturn a downward trend created during a slide to a nine-month low on Monday.
Chicago wheat rose 2 percent as investors covered short positions following a recent slide to a one-year low. In France, a sharp upgrade to forecast wheat exports outside the European Union by farming agency FranceAgriMer and a tender purchase by main French wheat buyer Algeria have bolstered export prospects this week.
A swelling lineup of ship loadings at French ports was also boosting sentiment, showing France was exporting widely after being heavily reliant on Algeria earlier in the season. "We're now seeing a multi-destination export lineup rather than the mono-destination one," a French trader said.
Export and livestock feed demand fuelled by the recent price fall could help the EU market regain ground, but the prospect of large cereal harvests this year will limit scope of a rebound, Strategie Grains said. The analyst firm trimmed its forecast for this year's EU soft wheat crop to 146.1 million tonnes, but it remained 15 percent above last year's drought-hit volume.
In Germany, hard hit by the 2018 drought, the association of farm cooperatives said in its first forecast for the 2019 wheat harvest that the new crop will rise by 19.4 percent from last year to 24.20 million tonnes. "The mild winter means current expectations are that an early start to Germany's harvest is possible and so the probability of supply gap up to the new crop is being reduced," one German trader said.
Standard bread wheat with 12 percent protein for March delivery in Hamburg was offered for sale unchanged at about 7.0 euros over Paris May. Buyers were seeking around 2 euros below this.
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