Paris wheat eases ahead of USDA world crop report
European wheat futures edged lower on Friday as traders awaited for direction from world crop forecasts from the U.S. government after a rally this week fuelled by Chinese demand.
March wheat BL2H4, the most active contract on the Paris-based Euronext exchange, was 0.4% down at 231.00 euros ($249.04) a metric ton by 1528 GMT.
The contract reached its highest level since mid-November on Wednesday at 234.75 euros before easing back.
Chicago futures Wv1 fell after an eight-day rally as grain markets looked ahead to the U.S. Department of Agriculture’s (USDA) monthly world crop report at 1700 GMT.
Chicago has led gains in wheat prices, supported by news of more than 1 million tons of U.S. wheat sales to China, the biggest one-week total to the country since July 2014.
The rally has been more limited on Euronext, particularly when factoring in weakness in the euro, as export hopes have been tempered by a lack of new French wheat sales to China and the absence of EU sales in two Egyptian tenders.
“EU wheat is still struggling for export business,” consultancy CRM Agri said in a note.
In France, a large wheat export programme for China is getting under way, with five vessels now scheduled to load according to LSEG data, but sparse recent demand was causing concern.
“We won’t reach our non-EU export objective if China doesn’t come back to buy more,” a futures dealer said, referring to a 2023/24 forecast of around 10 million tons by farm office FranceAgriMer.
Euronext participants were also awaiting Monday’s expiry of December wheat futures BL2Z3. The front-month contract was 3% up at 222.75 euros in volatile moves.
Wheat sowing in France continued to lag the average pace of recent years after a rain-disrupted campaign, FranceAgriMer data showed on Friday.
Traders are watching for Tuesday’s first grain planting estimates from the French farm ministry for a indication of any area losses for winter crops and a potential shift to spring varieties.
Source: Reuters (Reporting by Gus Trompiz; Editing by Alexander Smith)
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