European wheat futures in Paris rose on Tuesday, hitting their highest in around three weeks, supported by a rebound in US futures in Chicago and expectations of fresh export sales for French wheat in Algeria's international purchase tender this week.
Benchmark December milling wheat on the Paris-based Euronext exchange unofficially closed up 2.50 euros, or 1.4%, at 180.50 euros ($199.99) a tonne, its highest since October 29.
Algeria issued an import tender to buy milling wheat for shipment in January, except for South American origins, for which shipment was sought in December. The bidding deadline is on Wednesday.
France is expected to claim most of any purchase made by Algeria, with new-crop Argentine wheat seen as not yet competitive.
"Exports are driving the wheat market in France," one cash broker said. "French sales in the Algerian tender are being taken as read."
Export demand continued to be brisk on Tuesday, with Tunisia also buying wheat in a tender.
In Germany, cash premiums in Hamburg remained well over Paris as rising Russian prices led to more demand for German wheat in export markets.
Standard bread wheat with 12% protein for November delivery in Hamburg was offered for sale unchanged at 4.5 euros over Paris December. Buyers were offering up to 3.5 euros over Paris.
"Rising prices in the Black Sea region, especially Russia, are pushing more export demand to Germany," one German trader said. "German wheat is about $4 a tonne FOB cheaper than Russian and we are seeing a lot more purchase inquiries."
Russian wheat prices rose last week as Egypt, the largest buyer of grain from the country, made a major purchase, and more demand came from Kazakhstan, industry analysts said on Monday.
"We are seeing purchase inquiries for German wheat both for prompt shipment in November/December and in the first months of 2020," the trader said. "Customers are in the Middle East and throughout Africa, both north and south of the continent."
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