Euronext wheat extended losses on Monday to its lowest price in more than two weeks, pressured by falling US futures as weather forecasts pointed to rain relief for parched US crops. A warm, dry spell forecast for western Europe this week was also easing crop concerns after a damp, chilly start to spring had slowed sowing work and crop development.
May milling wheat on Paris-based Euronext fell by 1 euro, or 0.6 percent, to 163.75 euros ($202.66) a tonne. It earlier touched its lowest since March 29 at 163.25 euros. US wheat markets also fell, led by a 3 percent slide for Kansas futures, which represent the hard red winter (HRW) wheat crop that has suffered most from drought.
Weather forecasts called for significant rainfall this week in parts of the US Plains where HRW wheat is grown. "We know that HRW wheat needs moisture when it resumes growth after winter and it's coming now like a miracle," one futures dealer said.
In France, physical premiums eased in some regions, suggesting that market participants were managing to work around a rolling rail strike to secure grain, brokers said. However, a planned strike by French port workers on Thursday could slow loading activity at a time of brisk export demand, including to Saudi Arabia. In Germany, cash market milling wheat premiums in Hamburg were slightly firmer as sellers declined to follow the fall in Paris.
Standard bread wheat with 12 percent protein content for April delivery in Hamburg was offered for sale up 0.50 euros at 3.50 euros over Paris May. Feed wheat prices in Germany's South Oldenburg market were again above milling wheat, with April onwards delivery offered 1 euro up at 179 euros a tonne with buyers seeking 177 euros.
In Poland, prices were also supported by demand for feed wheat. "Poland's wheat exports are still very poor and it is largely purchase interest for feed wheat, especially from the German feed mills, which is keeping business running," one Polish trader said. "Feed producers are strong buyers for feed wheat and if they cannot buy any, they just buy milling wheat," the trader said. Polish milling wheat with 12.5 percent protein rose by 10 zloty a tonne in the past week to 670-700 zloty (161.1-168.4 euros) for April delivery.
Feed wheat also rose by 10 zloty a tonne to 660-690 zloty for April delivery. Traders estimate that Poland exported only 59,000 tonnes of milling wheat in March, down from 385,000 tonnes in March 2017. Only one major ship is currently reported loading wheat, taking 53,000 tonnes in Gdynia for South Africa.