European milling wheat prices edged higher on Tuesday, pulled by a rise on US grains markets, but volumes remained thin on a lack of new fundamental news, traders said. By 1050 GMT benchmark November on Paris-based milling wheat futures was 0.4 percent higher at 261.00 euros a tonne.
"The market is moving sideways. It is looking for a trend but if you read the latest news carefully it is rather bullish for grains," one trader said, referring to the latest crop ratings in the United States and concerns over potential damage from Tropical Storm Isaac. One trader also noted that November remained around technical supports at 259/260 euros, which it failed to break at the close the previous day.
Traders and analyst pointed to a strong euro against the dollar and tight world supplies as supporting elements but noted that poor economic outlook could weigh on demand and prices. In Chicago soybean futures fell for the second day on Tuesday as traders locked in profits from the summer rally on hopes that forecasts for rain could provide a boost to diminished crop expectations, traders said. Corn and wheat futures also fell G20 nations taking stock of the third global food price surge in four years will wait for September's crop report from the US Department of Agriculture before deciding whether to take joint action on the issue, France's farm minister said on Tuesday.
German prices were slightly firmer as Paris rose, while signs increased that Germany has gathered a good harvest despite earlier concern about summer rain. Standard milling wheat for September delivery in Hamburg was offered for sale up one euro at 266 euros a tonne with buyers at around 264 euros.
"The international markets are not providing a price lead today so some players are hesitant," one German trader said. "Attention remains on the weather in the US and the outcome of the Russian meeting on Friday." Russian Deputy Prime Minister Arkady Dvorkovich, who co-ordinates farm policy, will discuss prospects for Russia's drought-hit grain harvest with Agriculture Minister Nikolai Fyodorov on Friday.
A sharply reduced Russian 2012 grain crop forecast, which the government recently cut to 75 million tonnes, has sparked concerns Moscow might ban exports, stoking a rally in global prices. "The German wheat harvest is now in the very last stages with only a few minor areas in the north still to be harvested," the trader said.
Germany's own harvest outlook changed greatly after a burst of sunshine in past weeks enabled very fast progress to be made after repeated rain had delayed the harvest start. Germany will harvest 22.8 million tonnes of wheat this year, slightly up on the 2011 crop of 22.7 million tonnes, Germany's leading grain trading house Toepfer International said on Thursday.