UPDATE 2-European wheat at new 6-month low on Chicago slide

Fri Jan 4, 2013 1:11pm EST

(Recasts with new low, updates prices)
    AMSTERDAM, Jan 4 (Reuters) - European wheat futures fell on
Friday to a near-six-month low, pressured by soybean-driven
losses in Chicago and a steadying in the euro after an earlier
fall.
    * Benchmark March milling wheat on the Paris futures
market settled 3.00 euros or 1.21 percent lower at 243.50 euros
a tonne.
    * Just before the close it traded at 243.00 euros, under a
low of 244.00 euros set on Thursday and marking a level last
seen for the contract on July 6.
    * "We're very closely tied to the U.S. market," a futures
dealer said. "Paris is trying to gain ground, but Chicago is
keeping us in check."
    * U.S. wheat also traded near a six-month low, pressured by
a sharp fall in soybeans and a rise in the dollar. 
    * U.S. soybeans fell over 1 percent to a six-week low on
Friday, the fourth consecutive daily drop, on prospects the U.S.
government may increase its forecast size of the U.S. crop, a
likely bumper harvest of South American soy and China's
cancellation of orders for U.S. soybeans
    * The euro, however, recovered from earlier losses against
the dollar, thereby depriving Paris prices of support.
    * Paris futures had been earlier underpinned by firm
technical support between 244 and 245 euros, which prevented the
market from slipping further.
    * Volumes were moderate, with many operators in France not
expected to return until next week from the Christmas and New
Year holidays.    
    * French ports continued to show a long line-up of grain
loadings after heavy export sales towards the end of 2012.
    * Port data showed a cargo was due to load at Bordeaux next
week with 25,000 tonnes of maize for Japan. This follows a
first-ever bulk maize shipment to Japan in November and reflects
unusual flows in a tight maize market hit by a U.S. drought.
 
    
    GERMANY
    * German wheat was quoted at large premiums over Paris,
although volumes were thin and many market participants still on
holiday.
    * Standard milling wheat for January delivery in Hamburg was
offered for sale down 2 euros but well over Paris at 261 euros a
tonne, with buyers at around 259 euros. Prices were pushed down
by the afternoon weakness in the Paris market.
    * "The physical market is taking a very different view of
the supply and demand outlook than the futures markets, which
are at considerably lower levels," one German trader said. "But
the wheat supply balance is very tight following the poor crops
in Russia, Ukraine, Argentina and Australia."
    * "The EU and United States have good export prospects in
the coming weeks as our rivals exit the market, and this is
reflected in higher premiums in the physical market," he said.
    * There was also market talk that some EU consumers could be
considering importing U.S. wheat. The EU has a quota for
duty-free U.S. wheat imports, which otherwise are blocked from
coming to Europe by heavy customs duties.
    * Another trader said cheaper U.S. wheat could be attractive
to buyers in some EU countries including Spain, Britain,
Ireland, the Netherlands and even Germany.
    * "U.S. soft red winter wheat for January shipment is
currently around $336 a tonne cif to the Rotterdam/Antwerp port
range and $335 cif to Spanish ports. This is about 256 euros to
Rotterdam/Antwerp and 255-6 euros to Spain."
    * "These U.S. prices are starting to look attractive,
especially to feedmakers. I would not be surprised to see the EU
award U.S. wheat import licences next week."
    * Repeated demand and tight supplies kept German feed wheat
around the same level or even above milling prices. 
    * Feed wheat for January-March delivery in the South
Oldenburg market near the Netherlands was offered for sale down
4 euros but above milling wheat at 270 euros a tonne, with
buyers at 268 euros.
  
    * Prices as of 1733 GMT
  Product                 Last    Change   Pct Move End 2012 Ytd Pct                                     
                                                                                                         
  Paris wheat             243.25    -3.25    -1.32   248.75    -2.21
  London wheat            206.90     0.00    +0.00   208.25    -0.65
  Paris maize             235.50    -2.00    -0.84   238.75    -1.36
  Paris rape              446.75    -0.75    -0.17   456.25    -2.08
  CBOT wheat              745.75    -9.75    -1.29   778.00    -4.15
  CBOT corn               684.25    -5.00    -0.73   698.25    -2.01
  CBOT soy               1383.75   -19.25    -1.37  1418.75    -2.47
  Crude oil                92.54    -0.38    -0.41    91.82     0.78
 * Paris futures prices in Euros per tonne, London wheat in
pounds per tonne and CBOT in cents per bushel.


 (Reporting by Gus Trompiz and Axelle du Crest in Paris, Michael
Hogan in Hamburg and Ivana Sekularac in Amsterdam; Editing by
Alison Birrane and Jane Baird)
Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.