HAMBURG, Germany (Reuters) — European wheat futures edged lower in thin trade on Wednesday, remaining close to Tuesday’s contract lows, weakened by good harvest prospects in the northern hemisphere, including an improving outlook in France.
• “Harvest pressure is still weighing on the market,” a French futures dealer said.
• November 2013 milling wheat on the Paris Euronext futures market was down 0.25 euro or 0.14 percent at 184.00 euros a tonne by 1315 GMT, just short of positive territory.
• November wheat on Aug. 6 set a contract low of 183.00 euros, the lowest front-month price in Paris since December 2011.
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• The Paris market was facing chart resistance at 185 euros, which was previously a key support level, but was underpinned by a 180 euro technical floor, dealers said.
• The Paris trend was encouraged by the weaker U.S. market, where wheat edged down and corn hovered close to a near three-year low because of prospects.
for bumper U.S. harvests.
• Feedback in recent days from the advancing harvest in major north French wheat belts pointed to satisfactory yields and quality, leading dealers to raise production forecasts and scale down earlier quality concerns after low protein
levels in initial harvesting on the west coast.
• French consultancy ODA said it expects a French soft wheat crop close to 37 million tonnes, up from 35.6 million tonnes harvested in 2012 and 36 million forecast previously for 2013. ODA now sees the average yield rising by
0.7 percent on the year after previously expecting a fall of about 2 percent.
• But widespread showers and some storms on Wednesday in north France are likely to slow field work and could negatively impact the quality of ripe crops that are ready to be cut, traders said.
• In exports, traders noted more competitive French offers in the latest tender by Egypt on Tuesday. But higher ocean freight costs continued to penalize French wheat and Russian wheat was seen as more likely to challenge the current
dominance of Romanian and Ukrainian origins in Egyptian purchases.
GERMANY
• In Germany, attention remained fixed on the wheat harvest which is gathering speed in the south and centre of the country and is expected to start more broadly in northern and eastern export regions next week.
• Standard new crop milling wheat for September delivery in Hamburg was offered for sale little changed at 5.5 euros over the Paris November contract.
• There had been concern the very hot and dry summer may have stressed wheat in the north and east German grain belts, damaging quality values such as protein content.
• “The worry about quality damage is now starting to ease as early results in south Germany and test cuttings in north Germany show overall decent quality,” one German trader said. “The market is now waiting for more detailed harvest quality results.”
• The North and east German grain belts are the country’s main production regions for exports. Traders expect a broader start to the harvest there next week if dry weather continues. Hot weather with some showers is forecast for Germany up to Sunday night.
• German wheat harvesting is making good progress in the southern areas including Bavaria and along the Rhine but results vary between regions, the German Farmers’ Association said on Wednesday.
