Euronext wheat edged higher on Thursday, consolidating above contract lows with support from a firm trend in Chicago and a weaker euro, while traders assessed a mixed export outlook for west European wheat. Benchmark December milling wheat on Paris-based Euronext settled up 0.75 euro, or 0.4%, at 170.50 euros ($188.90) a tonne in light volumes. It had slipped to a life-of-contract low at 169.00 euros in the previous session.
In addition to technical support at current levels, Euronext was underpinned on Thursday by a slight rise in Chicago wheat after three-month lows on the US market. A three-week low for the euro against the dollar, which makes European wheat cheaper overseas, also lent support. But traders said large northern hemisphere supplies and stiff competition from Black Sea suppliers like Ukraine and Romania were keeping a lid on prices.
"There's not much newsflow and in wheat when there's no news it stays a bear market," one futures dealer said. "With the supply balance and the recovery in harvest production in Europe, the Matif (Euronext) lows make sense." In France, where the harvest is widely expected to be the second-biggest on record, hopes created by relatively competitive export prices were being tempered by a moderate pace of shipments and reluctant selling by farmers.
French wheat was seen in contention to be chosen for some of a 92,000 tonne optional-origin purchase by Tunisia on Wednesday. But it could again face competition from Ukraine, which is expected to be more active in wheat exports this season amid less aggressive Russian sales and as grain handlers try to shift a bumper Ukrainian wheat crop before a potentially record maize harvest this autumn.