July 9, 2019 / 4:37 PM / 11 days ago

Paris wheat around 7-week low on big crop, Egypt tender

    HAMBURG, July 9 (Reuters) - European wheat futures extended
losses on Tuesday to a near seven-week low as an official French
crop forecast underscored a positive outlook for harvests in
Europe, while an Egyptian import tender highlighted fierce
export competition.
    Front-month September milling wheat         on the
Paris-based Euronext exchange unofficially closed down 3.50
euros, or 1.9%, at 173.25 euros ($194.13) a tonne after hitting
173.00 euros its weakest since May 22.
    An opening fall that broke chart support and formed a
downside gap on price charts encouraged selling, dealers said.  
    Chicago wheat       also fell to multi-week lows as improved
 crop ratings and an advancing harvest in the United States
weighed on prices.       
    In France, the farm ministry's first forecast of 2019 soft
wheat production put the crop at 37.0 million tonnes, up 8.5%
from last year, supported by an expected increase in both yield
and area.             
    Egypt's state buyer GASC on Tuesday bought 240,000 tonnes of
Romanian and Ukrainian wheat in a tender, underlining tough
Black Sea export competition.           
    In Germany, premiums in Hamburg remained at recent depressed
levels as a large wheat harvest coupled with poor export
prospects depressed sentiment.
    Standard bread wheat with 12% protein for September onwards
delivery in Hamburg was offered for sale unchanged at 4 euros
under Paris December        . Buyers were seeking at least 5
euros under.
    Germany will harvest about 24.1 million tonnes of winter
wheat this summer, up sharply from the drought-damaged crop of
19.6 million tonnes last year, the German farming association
forecast.             
    "A harvest which will greatly increase supplies is
expected," one German trader said. "Following the heatwave in
late June weather in Germany has also normalised."
    "The trouble is that most of Germany’s export rivals are
also expecting much better crops after last summer’s drought,
especially in the Baltic Sea region and Poland."
    "I hear that even Swedish wheat has been offered for export
this month, confirming a recovery after disastrous Scandinavian
crops last year."
    Hot weather which has caused some reductions to previous
harvest forecasts in Russia and Ukraine was not seen as
supportive.              
    "The heat will be positive for quality, and wheat protein
content from Ukraine and Russia is likely to be high this year
meaning the Black Sea region will be more of a competitor in
export markets for better-quality wheat,” another trader said.
“There will also be much less cheap feed wheat available from
the Black Sea this summer.”


($1 = 0.8925 euros)

 (Reporting by Michael Hogan and Valerie Parent, editing by Jane
Merriman)
  
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