European wheat futures in Paris were flat to higher on Thursday as weather-fuelled gains in the US market lent support. But movements in Paris continued to be modest after mild weather in western Europe this week eased crop concerns and as operators awaited clearer signals about harvest prospects across the northern hemisphere.
Paris front-month May milling wheat was unchanged on the day at 246.75 euros a tonne by 1325 GMT. New-crop November was up 1.00 euro or 0.5 percent at 215.25 euros. November futures have outperformed the front month this week on the back of global weather risks and with operators taking advantage of a steep discount for new-crop prices after brisk exports and tight old-crop availability pushed up May futures in the past month.
Chicago wheat rose as growing regions continued to endure freezing weather at a time when much US wheat is in poor condition following months of drought. A late spell of wintry weather in Europe in late March and early April has also raised the risk of harvest delays and yield losses. The arrival of seasonable temperatures this week has eased worries but forecasts calling for a return to chilly temperatures at the weekend have revived some crop concerns.
"The general theme of delayed growth in northern hemisphere winter grains holds," INTL FC Stone Europe's Jaime Nolan-Miralles said in a note. "Temperatures will be monitored closely over the weekend across Western and Central Europe." Analysts Strategie Grains cut their forecast for soft wheat production in the European Union this year for the fourth straight month, mainly due to a cut in yield forecasts for Britain linked to adverse weather.
The market will also be looking at weekly EU export data due later on Thursday to see for signs of a slowdown in demand for relatively expensive and scarce old-crop EU supply. Last week, the volume of soft wheat export licences showed a three-month low, although it remained close to the average weekly pace this season. Weekly US export sales released earlier on Thursday showed a big volume for wheat, boosted by a hefty round of sales to China.