Euronext wheat resumes rally as Black Sea worries persist
European wheat futures reached a one-month high on September 13, 2024, with December contracts rising to €226.50 per metric ton, driven by concerns over Black Sea export supplies amid escalating tensions between Russia and Ukraine. The market rebounded from late August lows due to reduced EU wheat production forecasts and supply risks. U.S. wheat futures also gained, supported by a weaker dollar and Black Sea supply concerns.
PARIS, Sept 13 (Reuters) -European wheat futures rose on Friday to a fresh one-month high as rising international tensions over Russia’s war with Ukraine maintained concerns about Black Sea export supplies.
December wheat BL2Z4 was 1.7% up at 226.50 euros ($251.08) a metric ton by 1534 GMT.
The contract earlier reached 228.00 euros, its highest since Aug. 9 and above a previous one-month peak on Thursday.
Thursday’s news that a bulk carrier had been damaged after leaving Ukraine, with Kyiv accusing Moscow of hitting the grain vessel with a missile, added to growing doubts about Black Sea supply after weather setbacks to crops in the region.
The incident underscored escalation risks in the conflict as the West accuses Iran of supplying missiles to Russia while considering Kyiv’s calls for approval to fire Western missiles at Russian territory.
Euronext December futures have rebounded by more than 10% from a near six-month low of 204.75 euros struck in late August when brisk shipments of cheaper Russian and Ukrainian wheat weighed on prices.
Black Sea supply risks and short positions held by investors have fuelled expectations the wheat market is bottoming out after harvest season lows.
“Black Sea wheat exports have started this season at a sprint,” consultancy CRM Agri said in a note. “However, this pace contrasts with the smaller harvests this year.”
The wheat market is also facing a steep fall in European Union supply after rain-hit harvests in France and Germany.
Strategie Grains further reduced its forecast for soft wheat production in the European Union in 2024 to a 12-year low as the consultancy cut again its estimate of the French harvest.
The U.S. Department of Agriculture also lowered its estimate of EU wheat production in a widely followed world crop report on Thursday. But it tempered supply concerns by increasing its forecast for global wheat stocks. WASDE13
Chicago wheat Wv1 rose as much as 3.5% to its highest in nearly three months, as a drop in the dollar added to support from Black Sea risks. GRA/
Traders were also assessing Thursday’s news that Egypt purchased 430,000 tons of Russian wheat this week, with prices reported in the deal seen as low.
| Prices at 1534 GMT | |||
| Last | Change | Pct Move | |
| Paris wheat BL2Z4 | 226.50 | 3.75 | 1.68 |
| Paris maize EMAc1 | 208.00 | 4.25 | 2.09 |
| Paris rapeseed COMc1 | 466.25 | 0.00 | 0.00 |
| CBOT wheat Wv1 | 592.00 | 13.50 | 2.33 |
| CBOT corn Cv1 | 412.25 | 6.25 | 1.54 |
| CBOT soy Sv1 | 1019.75 | 9.00 | 0.89 |
| WTI crude oil CLc1 | 69.84 | 0.87 | 1.26 |
| Euro/dlr EUR= | 1.11 | 0.00 | 0.07 |
| Most active contracts – Wheat, corn and soy UScents/bushel, Paris futures in euros per tonne | |||
($1 = 0.9021 euros)
Source Link : https://www.xm.com/research/markets/commodities/reuters/euronext-wheat-resumes-rally-as-black-sea-worries-persist-53925410
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