EU wheat posts yearly gain as Russia supply uncertainty grows

European wheat futures extended gains on Tuesday to post an annual rise, supported by year-end strength in US grains and concerns about tightening wheat supply in Russia.

Benchmark March milling wheat on Paris-based Euronext settled 1.3% up at 237.25 euros ($246.41) per metric ton after a shortened session ahead of Wednesday’s New Year closure. The contract earlier reached 237.50 euros, a six-month high for a front-month price, with the breaching of technical resistance around 235 euros generating buying interest in light holiday volumes, dealers said.

Over the year, front-month prices were up 6.6%, stemming losses from last year when prices had pulled back from record levels in 2022 following Russia’s invasion of Ukraine. Like Chicago futures, Euronext wheat touched a four-year low during 2024 amid ample global supply and strong Black Sea exports that eased worries about the impact of war. But in Russia, poor early growth for the next winter wheat crop, rising local prices and steps by the authorities to curb exports have helped underpin the European market.

Euronext has also drawn support from a year-end rally in Chicago, with corn hitting a six-month peak and wheat a two-week top on Monday, against a backdrop of adverse weather in Argentina and steady US exports. However, export competition remained a curb on Euronext, even if poor harvests in France and Germany have reduced availability in western Europe.

Tags: exports, prices, wheat, futures