EU Wheat Exports are now more confident
Euronext Wheat Futures dropped for a third consecutive day on Thursday, closing 0.4% lower at 231.00 euros per metric tonne. This decline reflects a weak export outlook in Western Europe, despite demand from Algeria and Saudi Arabia. However, Algeria is expected to source wheat from the Black Sea region at lower prices, diminishing prospects for French exports. With a slight increase in EU soft wheat production forecast for 2025/26, the market remains cautious amid competition from cheaper Black Sea and other wheat sources.
Euronext Wheat Futures declined for a third consecutive day on Thursday, as the strength of the euro and the results of an Algerian tender highlighted a weak outlook for exports in Western Europe.
The price of a metric tonne of March wheat traded on Paris’ Euronext closed 0.4% lower at 231,00 euros ($240.98).
The front-month contract touched a low of 230.50 euro earlier this week, moving away from the high of 238.75 euro on Tuesday.
Euronext has been buoyed by recent short-coverings and signs of declining Russian competition. However, importers are now focusing on sluggish French exports.
One German trader stated: “The market has received new demand from large buyers Algeria and Saudi Arabia this week, which is positive. However, it doesn’t look like the west EU will receive much business.”
The Black Sea still looks too cheap. “Despite the winter weather and export quotas that are affecting Russian prices, Romania and Bulgaria also look cheap.”
Algeria is expected to purchase a large amount of wheat from the Black Sea region, including Ukrainian, Romanian, and Bulgarian wheat.
It was not clear what the final purchase volume would be, but it is believed to have been several hundred thousands of tons. Prices were around $262 to $263 per ton (cost and freight included), which is below Western European prices.
Euronext received a boost when it was announced that Saudi Arabia’s state purchasing agency will be tendering for 595,00 tons of wheat. However, the reaction to this news was moderated by expectations that Saudi Arabia may also receive Black Sea wheat or Australian wheat.
LSEG data revealed that France saw a rise in the loading of feed wheat, but mainly within EU. Barley dominated extra-EU grain shipments.
A futures dealer stated that “French Barley is finding markets despite issues with German barley, and high corn prices.” When you look at the Algerian bid prices, it is clear that the space for French wheat to be exported outside of the EU has shrunk.
The Consultancy Strategie Grains has slightly raised its forecast for soft wheat production for the European Union in 2025/26. It is still expecting a recovery from this year’s wet crop.
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Source : Marine Link
