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Paris wheat hits 11-month low on strong euro and Black Sea competition

Paris wheat hits 11-month low on strong euro and Black Sea competition
Paris wheat hits 11-month low on strong euro and Black Sea competition Copyright Thomson Reuters 2023
Copyright Thomson Reuters 2023
By Reuters
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HAMBURG - Euronext wheat futures slid to an 11-month low on Monday, extending losses from last week as a firm euro and competition from the Black Sea region again weighed on prices.

March wheat, the most active contract on Paris-based Euronext, was down by 4.75 euros, or 1.6%, at 280.00 euros ($304.02) a tonne at 1701 GMT.

It earlier slipped to 279 euros, the weakest front-month price since Feb. 23 last year, with selling fuelled by the breaching of technical support above 280 euros.

The euro earlier reached a nine-month peak against the dollar, highlighting export competition as cheaper Russian and Ukrainian grain supplies continued to flow despite the two nations' 11-month war.

"The market mood remains bearish, with Russian wheat everywhere you look," one dealer said.

Physical wheat premiums in France remained firm after brisk exports this season, though traders said there were signs of export demand shifting to barley after more sales to China.

May rapeseed was down 1.7% at 526.75 euros at tonne after setting the lowest second-month price since August 2021.

Rapeseed has been pressured by large EU imports and German plans to phase out crop-based biofuels. [GRA/]

“The nine-month high of the euro against the dollar is unwelcome at a time of large and cheap export supplies from the Black Sea, with Russia’s crop large and the safe shipping channel from Ukraine working pretty well despite inspection delays,” one German trader said.

“But export supplies in France and Germany are looking tight following large exports last year after the war in Ukraine started."

Standard 12% protein wheat for January delivery in Hamburg was offered for sale at a premium of about 11.50 euros over the Euronext March contract.

($1 = 0.9210 euros)

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