Euronext wheat hovers near lows

PARIS/HAMBURG, July 8 (Reuters) - Euronext wheat consolidated near contract lows on Tuesday as weak export demand and good harvest prospects hung over the market, while slow selling by farmers helped underpin prices.

September futures BL2U5 on Euronext settled 0.1% down at 195.75 euros ($229.01) per metric ton. On Monday, the front-month position had equalled a contract low of 192.75 euros from last Tuesday.

Chicago wheat Wv1 edged down as an advancing U.S. harvest weighed. GRA/

"The market needs a major event to rally," a futures dealer said. "At the same time, no one wants to sell."

Investors already hold large short positions in Euronext wheat, while traders say farmers are holding back on selling new crop because prices are below their production costs.

But a poor export outlook remained a brake on prices, with large incoming harvests leading importers to bid their time.

“If buyers delay purchases for even only a few weeks they could save a lot of money. With Euronext holding below 200 euros in this bearish constellation, you have to ask if the next Euronext resistance may be under 190 euros,” a trader said.

In Russia, a further cut in a wheat export tax to zero has put the focus back on its competitive supplies.

“The suspension of the export tax will give Russian exporters more freedom to capture demand,” another trader said.

“The tax was previously not very high but when prices are extremely close, the removal could be important in winning new business.”

In the important Egyptian market, Russian and Ukrainian 11.5% protein wheat were currently quoted about the same at $235-$237 a ton cost and freight included (c&f) for August shipment, he said, adding this was $15-$17 cheaper than French wheat depending on Euronext and exchange rate moves.

Consultancy Sovecon said on Tuesday it had raised its forecast for Russia's 2025/26 wheat exports by 2.1 million metric tons to 42.9 million tons, reflecting improved crop prospects and competitive prices.

European Union soft wheat exports in the 2024/25 season that ended on June 30 fell 35% year-on-year to 20.33 million tons, though some data was missing, the European Commission said.

In Germany, the wheat harvest has started in early southern regions, traditionally the first to begin work. But widespread rain forecast for Tuesday and Wednesday means an expansion of work is likely to be delayed.

($1 = 0.8548 euros)