European wheat was little changed on Tuesday as the market weighed up the positive factors of brisk short-term export demand and dry weather in Europe against good US wheat crop conditions which pushed Chicago futures lower.
Front-month May milling wheat on the Paris-based Euronext exchange unofficially closed up 0.25 euro or 0.1% at 195.50 euros ($213) a tonne.
The contract earlier rose to a near one-week high of 196.50 euros but faced chart resistance as it approached a two-month high of 198 euros struck in late March.
Spot futures remained supported by strong overseas demand that was raising concern about logistical snags during a coronavirus crisis.
US wheat futures in Chicago dropped on Tuesday after the US Department of Agriculture (USDA) assessed the US crop to be in better condition than analysts forecasted.
New-crop December Paris wheat unofficially closed unchanged at 189.75 euros.
"There have been fewer sellers on the physical market in the last few days in France and there is still a decent export programme to execute," a futures dealer said.
However, a dry spell across much of the European continent was helping underpin prices by raising some early doubts about this summer's harvest, traders said.
"Everybody is keeping an eye on crop conditions in Russia and Ukraine," the dealer said.
France's farm ministry on Tuesday estimated that the soft wheat area for this year's harvest would decrease by 7.5% compared with 2019 to a 17-year low.
Traders said the estimate was broadly in line with expectations in the wake of a rain-disrupted autumn sowing season.
In Germany, cash premiums in Hamburg continued to be underpinned by brisk German wheat exports.
Standard bread wheat with 12% protein for May delivery in Hamburg was offered for sale at around 5.5 euros over the Paris May contract, with market attention turning away from April delivery. Buyers were offering around 4.5 euros over Paris. "With Russian prices remaining high and the euro still generally weak below $1.10, the export outlook for the west EU looks good," one German trader said.
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