EU wheat eases again as Russian competition persists
On October 22, 2024, Euronext wheat futures fell to a three-week low due to strong Russian exports, despite rising Russian export prices. December wheat dropped 0.3% to €223.50 per ton, hitting a low of €221.50 earlier in the session. Russian wheat remains cheaper than European wheat, though its price advantage is narrowing. Meanwhile, February rapeseed rose 1.1% to €514.50 per ton, supported by a crude oil rally.
PARIS, Oct 22 (Reuters) -Benchmark wheat futures on Euronext fell further on Tuesday, touching a three-week low as brisk Russian shipments continued to weigh despite signs that government intervention was pushing up Russian export prices, traders said.
December wheat BL2Z4, the most active position on Paris-based Euronext, settled 0.3% down at 223.50 euros ($241.65) a metric ton.
It earlier slipped to 221.50 euros, its lowest since Oct. 1 and below a previous three-week low hit on Monday, before paring losses as Chicago wheat Wv1 rebounded from a one-month low.GRA/
Deferred positions on Euronext ended slightly higher.
Consultancy Sovecon raised its October forecast for Russian wheat exports to a potential record 4.8 million tons.
Heavy export flows have tempered concern about Russian policy proposals including an export price floor and restrictions on the sale of Russian grain in tenders to Russian exporters.
“The Russian moves have sharply cut the price lead of Russian wheat, but Russia still holds a price advantage and lots of Russian wheat is still coming into the world market,” one trader said.
Russian 12.5% protein wheat for November was quoted on Tuesday at about $245 a ton FOB, still roughly $10 cheaper than Germany, and Russian 11.5% protein still under French at $240.
Latest international tenders illustrated uncertainty about how Russian policy will play out.
Russian wheat was offered in tenders on Tuesday from Bangladesh and Tunisia, though not at the lowest prices and not only by Russian traders.
A Bulgarian trading house was believed to have sold 50,000 tons of Tunisia’s purchase at the lowest prices in the tender.
“People are waiting for more details, but the first signs from tenders today are that Russia is not out of the export game but has lost a lot of its huge price lead,” another trader said.
The return of rain to parched Russian and U.S. winter wheat belts in the past week, plus forecasts suggesting heavy rain in France will abate, have also curbed prices.
Field work in Europe should pick up in the next 10 days, the Commodity Weather Group said in a note.
In oilseeds, February rapeseed COMG5 on Euronext closed 1.1% up at 514.50 euros a ton after setting a three-month high, supported by a rally in crude oil. O/R
($1 = 0.9249 euros)
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