EU wheat rises as export demand stirs

PARIS, March 13 (Reuters) - Euronext wheat rose for a second session on Thursday to move further away from a six-month low, supported by strength in Chicago futures and improved export sentiment, traders said.

May wheat BL2K5 was up 1.5% by 1627 GMT at 226.50 euros ($246.07) a metric ton.

The contract had struck its lowest since late August at 217.75 euros on Wednesday before closing higher.

A large short position held by investment funds has made Euronext prone to short-covering bursts.

Chicago wheat Wv1 recovered from a two-day drop, as larger than expected weekly U.S. exports helped offset tariff concerns. GRA/

Euronext also drew support from export prospects following import tenders this week and amid ebbing competition from Russia.

"There are the Algeria and Tunisia tenders in the mix as well as some technical factors," a futures dealer said of the price rise.

Algeria bought about 450,000 metric tons of wheat on Wednesday, according to most traders, though some estimates put the volume higher at 500,000 to 560,000 tons.

Tunisia was believed to have purchased about 100,000 metric tons of wheat on Thursday.

This week's demand was seen absorbing some of the surplus in the Black Sea region and potentially leaving room for more Western European exports in the coming weeks.

A rally in the euro against the dollar has weighed on Euronext in recent days, though the euro eased on Thursday. FRX/

In France, Morocco remained the main export prospect in a slow campaign affected by last year's poor French harvest.

At Rouen, the country's largest grain port, nearly 35,000 tons of milling wheat were loaded for Morocco in the past week along with 20,000 tons of feed wheat and about 15,000 tons of feed barley, data from the port showed.

On the supply side, consultancy Strategie Grains slightly lowered its monthly forecast for this year's EU soft wheat crop, though it still projected a sharp rebound from the rain-hit 2024 crop.

In Germany, the 2025 wheat crop of all types will increase 15.4% on the year to 21.36 million tons, the country's association of farm cooperatives said in its first harvest estimate on Thursday.

“We could be on the way to a larger harvest and a more active role in export markets next season if the weather continues to be favourable,” a German trader said.

($1 = 0.9205 euros)