Euronext wheat is stable after autumn
European wheat futures edged up on Friday after two days of declines, with slight easing in the euro and forecast of cold weather in Argentina providing support, dealers said.
December wheat (BL2Z5) on the Paris-based Euronext market closed up 0.8% at 189.25 euros ($220.99) per metric ton. It previously matched Thursday’s one-week low of 187.25 euros before recovering.
During the week, the contract does not change.
Grain traders are also watching developments in US-China talks regarding their trade standoff and US President Donald Trump’s new steps to end the war between Russia and Ukraine.
December led Euronext’s gains, with dealers pointing to short-covering by investment funds that have large short positions concentrated in the month ahead.
“There appears to be a renewal of December position closings, perhaps due to the risk of cold weather in Argentina,” said one futures dealer.
Cold weather expected to hit Argentina’s agricultural heartland next week could affect wheat yields, the Buenos Aires grain exchange said on Thursday.
This reduces recent expectations of a bumper crop in Argentina and also offsets pressure from cheap Argentinian export prices.
Talk that importers in Morocco, France’s main overseas market, had bought Argentinian wheat weighed on Euro prices in December on Thursday.
The euro weakened against the dollar after rebounding from a two-month low reached on Tuesday.
Chicago wheat also strengthened as rising corn prices helped it pull away from a five-year low.
Euro prices next month remained supported by a steady flow of French exports, including two cargoes of wheat purchased on Wednesday by state grain buyer Egypt, according to sources.
However, abundant global supply remains market dependent, and favorable growing conditions in Europe add to supply pressure.
In France, the start of the dry season in October has helped farmers resume wheat planting before next week’s rain is expected to provide beneficial soil moisture.
French farmers had planted 27% of the soft wheat fields planned for next year’s harvest as of October 13, compared with 5% in the previous week, agricultural office FranceAgriMer said on Friday.
Less active deferred positions on Euronext fell to new contract lows before stabilizing at the close.
Source: Reuters
