EU wheat rises from lows on fresh export demand

PARIS/HAMBURG, April 16 - European wheat bounced from contract lows on Wednesday, supported by fresh international demand but a new rise of the euro against the dollar kept a lid on prices.

Benchmark May milling wheat BL2K5 on Paris-based Euronext, was up 0.2% by 1440 GMT to 210.75 euros a metric ton, having touched a contract low in the previous session.

The dollar resumed its descent on Wednesday, dropping across the board as a new bout of tariff-induced nerves gripped markets. The euro was up 0.8% against the dollar.

Traders welcomed new export demand with a purchase tender from Tunisia issued on Wednesday and price offers also being submitted in a tender from Algeria, while Jordan is continuing its recent buying interest with a new wheat tender next week. GRA/TEND

“The Euronext weakness this week has brought French and other west EU wheat back into contention against the Black Sea despite euro strength,” one German trader said. “French wheat is now about the same as Romanian and Bulgarian in export markets and cheaper than Russian.”

“Ukrainian is still the cheapest along with U.S. wheat, but I think there is some hope for the west EU against Black Sea competition if buyers avoid the war risk.”

Russian 11.5% protein wheat was still around $242-$244 a ton FOB, with French and Romanian wheat around $2 cheaper, he said.

Traders are awaiting indications of whether political tension between France and Algeria will prevent French wheat gaining sales in the Algerian tender.

Algerian grains agency OAIC tacitly excluded undefined French wheat and firms in its purchase tenders.

Farm office FranceAgriMer cut its estimate of French wheat exports outside the EU on Wednesday, citing low demand from Algeria and China. Non-EU exports of the rain-hit crop would now be 70% lower than last season.

In Germany, welcome rain fell again in much of the country with more forecast in the coming week after exceptional dryness in March and early April. But key northern German grain regions received little precipitation.

“A positive impact of dry weather is that fields are not wet and are firm enough for tractors to drive on so a very early start has been made to corn sowings in Germany this spring," another German trader said. "This is positive for harvest prospects as the longer corn is in the earth the better the growth and yield prospects will be.”