Heat wave in the EU threatens crops and supports grain prices
European grain markets rose as a heat wave swept across parts of the continent, raising concerns over potential crop damage. Wheat and corn futures on Euronext in Paris climbed to their highest levels since early June.
The greatest risk is seen for corn, which is currently at an earlier stage of development than wheat. In France, one of the EU’s largest grain producers, several regions have been placed under the highest heat alert as temperatures are expected to exceed 40°C.
The most-active Paris corn contract rose for a fifth consecutive session and gained as much as 4.1%, reaching its highest level since June 3. Wheat futures increased by up to 2.7%, hitting a three-week high.
By mid-session, corn on Euronext was trading at €221.25 per tonne, up 3.6%, while wheat rose 3% to €207 per tonne. At the same time, wheat and corn futures in Chicago were declining, while soybean prices remained broadly unchanged.
Despite the latest gains, European grain prices remain below their spring highs, when markets were supported by elevated fertilizer costs and weather-related risks. Last week, France’s Agriculture Ministry lowered its estimate for corn acreage, as some farmers shifted to crops such as sunflower and rapeseed.
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