Source: Ukragroconsult (Ukraine)
European wheat futures fell for the third day in a row on Thursday as competition from cheaper supplies from the Black Sea continued to weigh on export sentiment.
A slump in Chicago, as high forecasts for US spring wheat yields dampened concerns over dry weather, also depressed prices in Paris.
September wheat futures on the Paris-based Euronext exchange fell 1.2 percent to 219.75 euros ($238.80) a ton, down from Monday’s two-week high of 227.50 euros.
Favorable crop prospects in the United States and Russia and slow exports from Europe drew attention away from an expected drop in production in Western Europe.
“Markets are torn between fears that rains could damage crops in France, Germany and Poland, low Black Sea prices and a significant drop in export demand,” said a German trader.
Traders noted that Russian markets recovered slightly this week as Russian farmers fought back against the current low prices, but prices remain well below EU prices.
Russian wheat with a protein content of 11.5% for August delivery across the Black Sea was unchanged at around $210-211 per tonne FOB on Thursday, while Russian wheat with a protein content of 12.5% rose by around $1 to $220-222 per tonne FOB.
Traders are waiting for the start of harvest to assess the extent of the damage caused by the rains in France and Germany.
In France, farmers made progress with field work between rain showers this week. Early indications are that check weights are weak, but other quality metrics are holding up, traders said.
“In terms of quality, it doesn’t look as bad as 2016,” said one futures trader, referring to the worst harvest in France this century.
In Germany, traders were expecting drier weather next week to speed up the harvest after rain-induced delays.
“German farmers need 1-2 days of dry weather before they can resume harvesting in a big way, but that is the forecast for next week,” the trader added.
The European Commission on Thursday lowered its monthly forecast for EU soft wheat production in 2024/25 to 120.8 million tons, down from 121.9 million tons the previous month.
On the supply and demand side, the Commission raised its forecast for EU soft wheat exports in 2024/25 to 32.0 million tons, up from 31.6 million tons at the end of June.