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
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