Source: Ukragroconsult (Ukraine)
Wheat futures on the Euronext benchmark continued to fall on Tuesday, hitting a three-week low, as active supplies from Russia continued to exert pressure despite signs of rising Russian export prices, traders said.
December wheat futures, the most active item on the Paris-based Euronext exchange, fell 0.3 percent to 223.50 euros ($241.65) a metric ton.
It had earlier fallen to 221.50 euros, its lowest since Oct. 1 and below a three-week low hit on Monday, before trimming its losses as Chicago wheat recovered from a one-month low.
Open interest on Euronext closed slightly higher.
Consultancy Sovecon raised its forecast for Russian wheat exports in October to a possible record high of 4.8 million tons.
The intense export flows have eased concerns over Russian policy proposals, including setting a minimum export price and restricting the sale of Russian grain in tenders to Russian exporters.
“Russia’s measures have greatly reduced the price advantage of Russian wheat, but Russia still retains a price advantage and large volumes of Russian wheat are still flowing into the world market,” a trader said.
Russian wheat with a protein content of 12.5% for November was quoted at around US$245 per tonne FOB on Tuesday, still about US$10 cheaper than Germany, while Russian wheat with a protein content of 11.5% was still below French wheat at US$240.
The latest international tenders show the uncertainty about how Russian policy will develop.
On Tuesday, Russian wheat was offered in tenders from Bangladesh and Tunisia, but not at the lowest prices and not only by Russian traders.
A Bulgarian trading house is said to have sold 50,000 tons at the lowest prices in the tender.
“One awaits further details, but the early indications from today’s tenders suggest that while Russia has not exited the export business, it has lost much of its huge price advantage,” said another trader.
The return of rain to dry winter wheat growing areas in the Black Sea region and the US last week, as well as predictions that heavy rains in France will stop, have also pushed prices down.
According to the Commodity Weather Group, field work in Europe is likely to pick up again over the next 10 days.
In oilseeds, February rapeseed futures on Euronext closed 1.1% higher at €514.50 per tonne after hitting a three-month high, boosted by a rise in crude oil prices.