European wheat futures edged higher on Friday as the market held above a technical floor to recover from one-month lows. A drop in the euro against the dollar encouraged the market to steady and shrug off a further fall in US prices. A tender held by Egypt, the world's biggest wheat importer, gave some support as Russian wheat, a key competitor for EU origins, was not offered, even if Egyptian state buyer GASC overlooked French wheat in favour of a Ukrainian cargo.
November milling wheat, the most-traded contract on the Paris-based Euronext market, settled 0.25 euros or 0.1 percent higher at 199.25 euros a tonne, as it held a technical floor at 199 euros for a second successive close. "We're on an important technical level at 199 euros," one dealer said. "The euro-dollar rate has also eased a bit." The euro edged down slightly against the dollar to remain within sight of a 2-1/2 low hit on Thursday.
The absence of some French operators, who were attending a grain trade gathering at the southern port of Sete, also encouraged the consolidation trend on Friday. The November contract had slipped to a one-month low of 198.50 euros during Thursday's session, pressured by a slide in US prices linked to more clement weather for struggling US crops and a comfortable world supply outlook.
Chicago wheat fell for an eight straight session on Friday. Egypt's latest tender, in which it bought 60,000 tonnes of Ukrainian wheat, drew few offers in view of a June 20-30 shipment period seen as awkward for securing grain ahead of northern hemisphere harvests, traders said. Good crop conditions in Europe continued to act as a curb on prices. In a weekly crop update, farm office FranceAgriMer said 73 percent of soft wheat was rated good or excellent as of May 12, unchanged on the week.
Polish flour mills were offering to buy at 800 to 820 zlotys a tonne (190.8 to 195.5 euros) for delivery to mills in May/June, down 20 zlotys a tonne (4.7 euros) on the week. Exporters were offering to buy at 835 zlotys a tonne (199 euros) for end May/first half June delivery to Polish port silos, down about 15 zlotys (3.5 euros) on the week.
"Selling prices to exporters were much higher at between 850 to 860 zlotys a tonne (202.7 to 205 euros) so sales to exporters are currently very limited," the trader said. Traders said they expected one or two consignments of Polish wheat to be shipped to Saudi Arabia to cover the purchases in the last Saudi tender. "It is expected the shipment will be done in the second half of June and the beginning of July, when Polish new crop wheat is not available yet," a trader said.