February 28, 2013 / 1:55 PM / in 5 years

European wheat tracks U.S. rise on export demand

PARIS, Feb 28 (Reuters) - European wheat futures rose in step with U.S.
prices on Thursday to hit the highest level in nearly a week on signs that a
recent pullback in wheat markets was stirring fresh export demand.
    * Benchmark May milling wheat on the Paris futures market was up
1.25 euros or 0.53 percent at 238.75 euros a tonne by 1342 GMT. It earlier rose
to 239.00 euros, a resistance level and highest price for the contract since
Feb. 22. 
    * Traders said end-of-month adjustments were also contributing to the price
    * A fall in U.S. prices to an eight-month low this week has stirred some
export demand for U.S. wheat, helping Chicago wheat rise on Thursday. 
    * "The milling wheat market has been strongly supported by international
demand over the past days as U.S. traders sold milling wheat to China, Japan,
Taiwan and Egypt," Arnaud Saulais of Starsupply Commodity Brokers in Geneva
    * The inclusion by Saudi Arabia of soft wheat in a tender along with the
hard wheat it usually imports was also seen as offering a fresh opportunity to
relatively cheap U.S. Soft Red Winter wheat. 
    * While U.S. wheat is expected to claim a growing share of export sales in
the remainder of the 2012/13 marketing season, European wheat was still seen as
attractive in certain destinations, helped by a seven-week low for the euro
against the dollar this week. 
    * Weekly European Union export data later on Thursday will be watched as a
sign of demand after a large volume last week. 
    * Weekly U.S. export sales for wheat released on Thursday were within the
range of trade estimates.  
    * A tender by Tunisia to buy 50,000 tonnes of milling wheat, together with
25,000 tonnes of feed barley, will offer another export indicator this week.
    * Export sentiment was more downbeat in Germany, where premiums over Paris
prices fell again and traders reported imports from Brazil.
    * Standard milling wheat for March delivery in Hamburg was offered for sale
unchanged but still over Paris at 254 euros a tonne with buyers at around 252
    * Selling premiums of around 7 euros over Paris were being requested in
Hamburg, down 1 euro on the day and a fall from 10 euros on Tuesday and 15 euros
in early February.
    * "The export outlook for German and other EU wheat is worsening with U.S.
wheat currently much cheaper and likely to win new rounds of international grain
tenders," one German trader said. "Market talk is that imports of cheap wheat
from the United States and Brazil are coming into Germany and the rest of the
    * German importers have purchased about 60,000 tonnes of feed wheat from
Brazil, traders said on Thursday. 
    * Feed wheat for nearby delivery in the South Oldenburg market near the
Netherlands was offered for sale up 2 euros at 258 euros a tonne with buyers at
256 euros.
    * But feed wheat from the 2013 new crop was quoted well below old crop at
between 216-217 euros a tonne.
    * "The lower new crop prices are an indication that the winter weather is
very mild and grain plants have not suffered major frost damage so far this
winter," another trader said.
 * Prices as of 1341 GMT
  Product              Last    Change   Pct Move End 2012 Ytd Pct 
  Paris wheat         247.25     0.75    +0.30   250.25    -1.20
  London wheat        206.25     0.90    +0.44   210.25    -1.90
  Paris maize         227.25     0.50    +0.22   237.75    -4.42
  Paris rape          466.50    -0.50    -0.11   456.25     2.25
  CBOT wheat          711.75     7.50    +1.06   778.00    -8.52
  CBOT corn           713.00     3.50    +0.49   698.25     2.11
  CBOT soybeans      1468.25    10.75    +0.74  1418.75     3.49
  Crude oil            92.83     0.07    +0.08    91.82     1.10
 * All contracts front month except second month for London wheat.
 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 and Michael Hogan in
Hamburg; Editing by Anthony Barker)

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