Paris wheat at 3-month low on good US, Russian crop prospects
HAMBURG/PARIS, July 15 (Reuters) -European wheat futures extended losses on Monday to a three-month low as the breaking of chart support added technical pressure from favourable U.S. and Russian crop prospects.
September wheat BL2U4 on the Paris-based Euronext exchange fell 2.3% to 214.75 euros ($234.29) a metric ton at 1544 GMT.
The contract earlier hit 213.25 euros, its weakest since April 18, as the breaching of the 220 euro floor and the opening of a downside chart gap fuelled an early slide, dealers said.
Chicago wheat Wv1 dropped to its lowest since March on Monday on expectations of large crops in the U.S. and Russia. GRA/
"You could feel it coming the break below 220 euros on Matif (Euronext), though with many people already short the market didn't plummet," a futures dealer said.
"This morning's drop suggests harvest pressure on the wheat market might last a bit longer."
Wheat prices had fallen on Friday when the U.S. Department of Agriculture's (USDA) monthly world report projected U.S. wheat production above market expectations.
In Russia, consultancy IKAR on Monday raised its forecast of this year's wheat harvest, underscoring a recent improvement in crop conditions.
The U.S. and Russian harvests have taken attention away from poor prospects in France, where heavy rain is expected to push production down to one of its lowest levels in decades.
Unsettled weather, including storms on Monday, have added to difficulties for French farmers in the past week, though a dry, hot spell expected from Tuesday may help harvesting accelerate and give a boost to crops that are still ripening.
"Russian prices arestabilising but Russian 12.5% wheat cheap at under $200 a ton, representing very tough export competition for EU wheat," one German trader said. "Meanwhile, export demand is also looking very quiet with hardly any purchase tenders this week."
Reporting by Michael Hogan and Gus Trompiz, editing by David Evans
Related Assets
Latest News
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.