Euronext wheat futures ended flat on Wednesday as traders weighed up prospects for increased demand for west European supplies against limited evidence so far of an export upturn. March milling wheat, the most active contract on Paris-based Euronext, settled unchanged on the day at 205.75 euros ($234.33) a tonne. It earlier rose to a new two-week high of 206.75 euros but, similar to Tuesday, failed to breach resistance at 207-208 euros.
Brisk international demand and signs of tightening supply in the Black Sea region were maintaining hopes for an upturn in west European exports. A purchase by Tunisia on Wednesday in an import tender could be partly filled by French wheat, traders said. "Russian prices are pushing upwards so that's supporting Euronext," one futures dealer said. "We'll need to wait for the next Egyptian tender to have a clearer picture."
Egypt, the world's biggest importer, seeks offers by origin in its tenders, giving a snapshot of competition between exporting countries like Russia, France and the United States. Egypt's return to the market is also being keenly awaited after the country announced this week both a change in payment terms and fresh funding for state buying agency GASC.
A month-long partial shutdown of the US government was reducing visibility on grain markets by depriving traders of US export data and supply-and-demand forecasts. In France, port data showed a general upturn in loading activity, including large vessels due to take barley to Saudi Arabia. Port schedules, however, showed no wheat loadings for France's main export market Algeria, suggesting rival suppliers like Argentina or the United States may have been chosen for some recent orders.
The head of agricultural group InVivo called on French grain cooperatives to join forces to become more competitive in exports, including by merging trading desks. In Germany, standard bread wheat with 12 percent protein for January delivery in Hamburg was offered for sale flat at 4.00 euros over Paris March. "Wheat loadings in German ports are enough to support the market but not to provide extra stimulus," a German trader said. "Feed wheat prices remain high and there is talk of recent sales of French wheat into the north German feed market."
Feed wheat in the South Oldenburg market in north Germany for February/March delivery was offered for sale above milling wheat, unchanged at around 218 euros a tonne, with buyers seeking 217 euros. Weekly Euronext data showed financial investors reduced their net long position in the exchange's wheat futures and options in the week to January 18.