September 17, 2012 / 4:42 PM / 5 years ago

UPDATE 1-European wheat down in step with U.S. market

(Updates prices)
    AMSTERDAM, Sept 17 (Reuters) - European wheat futures eased on Monday in
step with U.S. prices in a pause after a broad market rally on Friday and with
some spillover pressure from the advancing corn harvest in the United States.
    * Strength in the euro and improved weather conditions for U.S. wheat sowing
also added pressure on European wheat, but healthy export prospects as
drought-reduced Russian supply runs low were keeping a firm floor under prices,
traders said.
    * "We're following the general wave of profit-taking, based on a very small
catalyst which is a forecast for the start of an improvement in weather in the
southern hemisphere," a futures dealer said, referring to forecast rain in
    * Benchmark November milling wheat on the Paris futures markets was
down 8.75 euros or 2.16 percent at 260.75 euros a tonne by 1608 GMT.
    * On Friday, it hit a one-month high at 268.75 euros, buoyed by investor
enthusiasm at the Federal Reserve's fresh stimulus plan to help the U.S.
economy, but failed to reach a contract high of 271.50 euros seen as a key
resistance level.
    * "We had a decent push at the end of last week on the back of the Fed and
now we're correcting a touch," a futures dealer said.
    * Chicago corn futures fell to a two-month low and soybeans tumbled to their
lowest price in nearly one month on Monday, pressured by anecdotal reports of
better-than-expected yields and liquidation of long positions. 
    * France has called an emergency meeting of G20 countries for mid-October to
discuss coordinated action to curb volatility on grain markets, the French
president's office said in a statement 
    * The euro, which held near a four-month high against the dollar, had only a
limited drag on Paris futures given signs that prices in major exporter Russia
were continuing to rise as supply dwindled after a sharply lower harvest.
    * "The rise in the euro is there but it's offset partly by the difficulty in
getting more grain out of Russia," one trader said.
    * Western European wheat looks set to profit from a near exhaustion of
available supplies in drought-hit rival exporter Russia that could lead to a de
facto ban on shipments from last season's number three seller. 
    * French wheat last week scored its first sales of the season to the state
buyer in Egypt, the world's top wheat importer, offering evidence that export
demand is shifting away from increasingly scarce and expensive Black Sea supply.
    * Standard milling wheat for September delivery in Hamburg was offered for
sale down 5 euros at 265 euros a tonne with buyers at around 263 euros.
    * "The euro's strength is something of a disappointment at a time when a
good window for west European wheat exports had been opening as Russian wheat
fades from the market," one German trader said.
    * German feed wheat in the South Oldenburg market close to the Netherlands
continued to be quoted close to milling wheat, offered for sale down one euro 
at 264 euros a tonne for September delivery with buyers around 260 euros.
    * Prices in Poland rose by between 4 to 5 euros a tonne during the last week
following demand for both milling wheat and feed grain seen by exporters and
local consumers.
    * Standard milling wheat for September delivery to Polish ports was quoted
on Monday at 1,020 zloty a tonne (249.50 euros a tonne). Polish flour mills were
offering lower prices of between 940 to 960 a tonne (230 to 235 euros) delivered
to mills, traders said.
    * Polish feed wheat prices were quoted in the same range as milling wheat at
940-960 a tonne delivered to feed plant.
    * "Flour mills seem to be well covered for the next 4 to 6 weeks so they are
not in a hurry to buy grains at any price," a Polish trader said. 
    * "Exporters are still sitting on large stocks in the ports waiting for
first ships to be loaded," he said.
    * Trade talk was that a hefty 1.1 million tonnes of Polish grain has been
booked for export up to the end of January 2013 including internal EU sales to
traditional customers like Germany. The total is said to include 400,000 tonnes
of wheat, 350,000 tonnes of corn and 150,000 tonnes of rye.
 * Prices as of 1620 GMT
  Product             Last    Change   Pct Move End 2011 Ytd Pct 
  Paris wheat         260.75    -5.75    -2.16   195.25    33.55
  London wheat        205.00    -2.00    -0.97   153.65    33.42
  Paris maize         244.50    -6.50    -2.59   197.25    23.95
  Paris rape          507.00   -12.50    -2.41   421.50    20.28
  CBOT wheat          887.25   -37.00    -4.00   671.25    32.18
  CBOT corn           749.25   -32.75    -4.19   654.75    14.43
  CBOT soybeans      1669.00   -70.00    -4.03  1207.75    38.19
  Crude oil            99.11     0.11    +0.11    98.83     0.28
  Euro/dlr              1.31     0.10    +8.35     1.30     1.32
 * All grain and oilseed prices for second position. Paris futures prices in
Euros per tonne, London wheat in pounds per tonne and CBOT in cents per bushel.

 (Reporting by Valerie Parent and Gus Trompiz in Paris, Michael Hogan in Hamburg
and Ivana Sekularac in Amsterdam; Editing by William Hardy)

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