EU wheat drifts in U.S. holiday lull as traders mull Egypt import shakeup
PARIS, Nov 28 (Reuters) -Euronext wheat futures were little changed on Thursday as a U.S. holiday closure deprived the market of usual direction while traders wrestled with news that an unfamiliar Egyptian agency sought to buy wheat for the major importing nation.
March wheat BL2H5, the most active position on Paris-based Euronext, was flat at 222.50 euros ($234.76) per metric ton by 1606 GMT, after earlier easing to a near two-week low at 221.50 euros.
Euronext prices have been pressured this week by a rebound in the euro EUR=, a slide in the rouble RUB= and results from international tenders that have underscored competition from Black Sea supplies. GRA/EU
With Chicago futures, the global benchmark, closed for the Thanksgiving holiday, traders were assessing an attempt by Egypt’s Mostakbal Misr Agency for Sustainable Development to purchase wheat.
The entity, founded in 2022 by presidential decree, announced it was seeking offers on Thursday to purchase wheat and vegetable oils through direct purchase agreements, breaking with the tender system usually run by the General Authority for Supply Commodities (GASC).
However, Russian exporters said they lacked official notification from Egypt to be able to submit offers to the new agency and traders later reported that Mostakbal Misr had made no purchases.
“The news about the new wheat purchasing agency in Egypt caused surprise today,” one German trader said.
“It may take a bit of time for the new agency to establish itself as traders need confidence about who they are dealing with and if they will get paid. But the Egyptians have to eat and need the wheat, and if there is confidence about payment people will make sales to the new agency.”
Low Black Sea cash market prices continued to hang over the European market, traders said.
Russian December 12.5% wheat was offered at around $225-$227 a ton FOB and both Russian and Ukrainian 11.5% at $218-$219 a ton.
Romanian 11.5% December wheat was higher at $225-$230 a ton FOB.
Traders have been watching for a possible slowdown in Black Sea shipments as harvest supplies are depleted and Russia looks to curb its exports.
"Markets expect Russia to be nine million tonnes down on December to June exports in comparison to last year's volume," British merchant Frontier Agriculture said in a note.
"This is a substantial amount. However, it has not caused concern as tonnage from North America and the Southern Hemisphere should fill the shortfall."
($1 = 0.9478 euros)
Reporting by Gus Trompiz in Paris and Michael Hogan in Hamburg; editing by David Evans
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