April 1, 2014 / 5:11 PM / 4 years ago

EU wheat slips to 3-week low as U.S. futures fall

LONDON, April 1 (Reuters) - Wheat prices in western Europe fell to a three-week low on Tuesday, weighed by a sharp setback in Chicago following a U.S. government report indicating stocks were higher than expected.

* Old crop May milling wheat on the Paris-based Euronext market ended a marginal 0.25 euros higher at 208.00 euros a tonne after earlier slipping to a three-week low of 206.75 euros. New crop November ended 1.00 euro lower at 200.75 euros a tonne.

* Dealers said the May contract was boosted by short covering ahead of next month’s expiry.

* “There were no major fireworks, although some are now expecting a possible decoupling of wheat and corn prices,” one European trader said.

* “Corn looks well supported by the USDA forecasts of tighter stocks than expected and smaller plantings, while wheat faces downward pressure from the USDA forecast of larger stocks,” the trader added.

* Feed wheat futures in London were lower with May off 0.75 pounds or 0.45 percent at 165.00 pounds a tonne.

* German old crop wheat premiums were little changed in a cautious mood as the U.S. Department of Agriculture reports on Monday were debated, but with export optimism still supporting.

* Standard milling wheat for April delivery in Hamburg was offered for sale at an unchanged premium of 1 euro over the Paris May contract. Buyers were offering level Paris.

* New crop wheat for delivery from September was offered for sale down 0.5 euro at 3.5 euros over Paris November with buyers offering 3 euros over, with the market following the weaker trend in Paris.

* Expectations that April will again see strong German export traffic in German ports supported old crop wheat, while continued warm weather promised to favour the new crop. (Reporting by Nigel Hunt in London, Michael Hogan in Hamburg and Valerie Parent in Paris; Editing by Anthony Barker)

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