Euronext wheat futures turned slightly lower in late trading on Thursday to close at a one-week low, after higher than expected estimates of US corn and soybean production quelled optimism about French wheat clinching export sales in an Algerian tender. December milling wheat on Paris-based Euronext settled down 0.25 euro, or 0.2 percent, at 160.25 euros ($186.60) a tonne, its weakest level since November 2. It earlier added as much as 1.25 euros, recouping losses from Wednesday, supported by hopes for French wheat in Algeria's tender on Thursday as well as news that Tunisia would hold an import tender on Friday.
But Euronext later reacted to a drop in US corn and soybean futures following the US Department of Agriculture's (USDA) monthly crop report. The USDA lifted its US corn yield forecast to a record level and left unchanged its soybean yield estimate, contrary to average analyst expectations for a slight cut. "The import tenders played a part in supporting wheat, with Algeria and now Tunisia in the market," a futures dealer said.
"But the USDA was a disappointment, with the unchanged soybean yield and the enormous corn yield." The USDA also kept unchanged its estimate of Australia's weather-hit wheat harvest, which has been one area of uncertainty in a heavily supplied global market. Traders were awaiting results from Algeria's tender, in which the country was seeking wheat for December shipment for the second time, an unusual move linked to potential delays in receiving wheat from South America.
Given Algeria's need to ensure its import requirements were covered for next month, main supplier France was thought likely to provide most of what is expected to be a relatively small top-up volume, traders said. Prices were believed to be around $210-$211 a tonne, cost and freight included, traders added. European Union soft wheat exports had reached 7.0 million tonnes by November 7, down 25 percent from a year earlier, official data showed on Thursday.