Benchmark European wheat futures were little changed on Monday as traders weighed slow farmer selling after recent price lows against stiff export competition from a bumper Russian harvest. Activity was subdued in a session marked by a holiday closure on US markets for Labor Day.
December milling wheat on Paris-based Euronext, settled unchanged versus Friday's close at 160.50 euros ($191.20) a tonne. The Euronext benchmark rebounded last week from a contract low of 156.50 euros, raising expectations that the market was bottoming out after the harvest season created supply pressure.
"The consolidation trend looks like establishing itself, helped by strong retention of crop by producers, although the size of Russia's harvest and export surplus continue to be a focus of attention," a futures dealer said. A rise in Russian export prices, linked to a strengthening in the rouble against the dollar, was also encouraging western European prices to consolidate.
Forecasters have progressively increased their estimates for this year's Russian wheat crop to far above a previous record volume seen in 2016, putting the country in a good position to maintain its spot as the world's largest wheat exporter. Russian competition and strength in the euro have dampened export hopes in France after a better than expected harvest in the European Union's top producer.
"The situation still remains delicate for French wheat which lacks competitiveness for export and for now is relying on sales to other EU countries and to Algeria," consultancy Agritel said in a note. French port data illustrated limited loading activity.