PARIS: Euronext wheat fell for a second day on Friday as participants expected a wartime export corridor from Ukraine to hold beyond a Saturday deadline, maintaining flows of Black Sea grain.
Egypt’s purchase of 120,000 tonnes of Ukrainian wheat on Thursday reinforced belief that the Black Sea shipping corridor would be extended, while a rise in the euro against the dollar further dampened export sentiment in western Europe.
May milling wheat, the most active wheat position on Paris-based Euronext, settled down 1.1% at 265.50 euros ($283.34) a tonne. Over the week, it was up 1.4% after recovering from a one-year low last Friday.
Paris wheat had rebounded earlier in the week, with dealers citing short-covering in response to turmoil in the banking sector as well as doubts over Black Sea corridor negotiations. But despite a lack of agreement between Moscow and Kyiv over how long the deal should be renewed for, traders still anticipated an extension beyond Saturday’s current expiry date.
“The talks on extending the shipping agreement were really going to the last minute deadline today but the market was seemingly untroubled by the lack of news about a final agreement,” one German trader said.
“Overall the Russians were saying a 60 day extension and the others 120 days, so it seems to be a question of not if but how long the deal will be prolonged.”
Egypt’s purchase of Ukrainian wheat, along with large offers of Russian wheat in Thursday’s tender, underscored how Black Sea exports are continuing in the midst of Moscow’s year-old invasion of Ukraine.
Nearly all French winter wheat and barley crops remained in good condition last week, farm office FranceAgriMer said, suggesting recent showers have eased dryness that developed during an unprecedented dry spell in February.
Rapeseed on Euronext extended losses to a new two-year low as weakness in related vegetable oil and crude oil markets added to pressure from ample rapeseed supply in Europe.
May rapeseed settled down 1.1% at 467.25 euros a tonne, after earlier touching a lowest front-month price since February 2021 at 463.75 euros.