European wheat prices edged lower on Monday in the wake of a fall on US market but a weak euro against a dollar that makes European grains more competitive kept a floor on prices, traders said. New crop September milling wheat on Paris-based Euronext, was down 0.75 euro or 0.4 percent by 1607 GMT to 172.50 euros a tonne. Front month May rose 0.3 percent to 184.00 euros a tonne, as it nears expiry on May 10.
Prices were also pressured by showers in the past days in Western Europe where crops have suffered from dry weather although they were uneven depending on regions. Weather forecasts point to a drop in temperatures in Germany and France at the end of the week. Operators will monitor any impact on young spring crops.
Saudi Arabia's state-owned grain buyer SAGO said on Monday it bought 620,000 tonnes of wheat in its latest international tender. Traders noted a wide price gap between old crop and new crop prices.
Old crop wheat was likely to be sourced in Germany and Baltic States while new crop wheat would likely come from the Baltic countries and a small part from the United States.
Favourable weather during spring grain sowing in Black Sea producers Russia and Ukraine is increasing the chances of another large grain harvest due to healthy levels of soil moisture, analysts and traders said last week. Activity was expected to be low this week with Euronext closed on Wednesday and a long May holiday in Russia.
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