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Paris wheat eases to 10-month low with exports in focus

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PARIS, Jan 16 (Reuters)Euronext wheat edged to a 10-month low on Monday as strength in the euro and cheaper Black Sea supplies kept a lid on prices despite talk of Moroccan demand.

Volumes were light as a U.S. holiday deprived the market of usual direction.

Traders were also looking ahead to a wheat import tender by Algeria on Tuesday as a fresh gauge of Black Sea competition.

March milling wheat BL2H3 on Paris-based Euronext settled 0.4% down at 287.50 euros ($311.02) a tonne.

The contract earlier fell to 286.25 euros for its lowest since March 8 and a weakest front-month price BL2c1 since Feb. 23.

The filling of a chart gap to the downside added to selling impetus, dealers said.

The euro EUR= earlier touched a nine-month peak against the dollar, making European grain more expensive for export.

“The euro-dollar rate is playing an important role; you have to think of Euronext in dollar terms,” one futures dealer said.

Competitive offers of Russian wheat in tenders by Turkey and Egypt last week have weighed on futures.

“Ship insurance from Russian ports became considerably more expensive this year, but low Russian prices were able to overcome this in tenders last week from Turkey and Egypt,” one German trader said.

Cheap prices were again being offered on Monday for shipments through Ukraine’s wartime shipping corridor, traders said.

However, fresh demand from Morocco for western European supplies was lending support.

After chatter last week that several cargoes of French wheat had been sold for nearby shipment, there was talk that six to eight vessels may have been sold, including some German supplies.

“A bright spot is market talk that Morocco last week bought about 180,000 to 240,000 tonnes of milling wheat, mainly from France but possibly some to be sourced from Germany, for rapid arrival,” the German trader said.

Brisk exports so far this season have underpinned physical premiums in France and Germany. GRAIN/SHP/FR, WHEAT/RTR

In Germany, standard 12% protein wheat for February delivery in Hamburg was offered for sale at a premium of about 13 to 14 euros over Euronext March, but with little purchase interest visible.

($1 = 0.9244 euros)

(Reporting by Gus Trompiz in Paris and Michael Hogan in Hamburg Editing by David Goodman)

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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