EU wheat prices fall due to pressure from global stocks

European wheat prices continued to fall on Wednesday, traders said, following Monday’s gains, which were considered excessive given ample global supplies.

On the Paris-based Euronext exchange, milling wheat futures for December delivery closed down 0.1% at €192.00 per tonne, after reaching a nearly two-month high of €193.50 on Monday.

Meanwhile, the most-traded wheat contract in Chicago rose 0.2% by the same time to $5.30 per bushel, as the entire U.S. grain complex was supported by optimism that China and the U.S. could reach a soybean purchasing agreement.

“Euronext wheat is not in line with optimistic forecasts for a U.S.-China trade deal,” a German trader said.

Wheat is unlikely to be the main component of any deal. Prices will likely receive only indirect support from investor interest in commodities and a possible strengthening of the US dollar.

According to traders, Russian wheat is leading the price in export markets, but import demand is weak, and Argentine wheat remains the cheapest large-scale wheat in the world.

According to traders, Russian wheat with 11.5% protein was priced at around $228-$230 per ton FOB for November/December delivery. French, German, Ukrainian, and Romanian wheat followed, all in a similar range of $231-$234 per ton FOB.

Argentine wheat, 11.5% of the new crop, remained the cheapest at $210-212 per tonne FOB, as importers in Morocco are rumored to have purchased Argentine wheat for December delivery this week.

“Low prices on Euronext mean German farmers are reluctant to sell wheat, and trading is more focused on rapeseed and feed barley, despite attractive export prices for German wheat,” said another German trader.

“Importers from North Africa and the Middle East, including Morocco, are showing strong interest in German feed barley.”

Tags: wheat, EU, prices