Updates after U.S. opening, adds German market comment
PARIS, Nov 26 (Reuters) – Euronext wheat futures fell sharply on Friday to pull away from this week’s record highs, pressured by a slide in financial markets as investors fretted about a coronavirus variant. MKTS/GLOB
A rebound in the euro against the dollar added to pressure. FRX/
Chicago wheat Wv1 also fell as U.S. markets reopened following Thursday’s Thanksgiving holiday, extending a pullback from a nine-year high earlier this week. GRA/
However, Euronext found support around the key 300 euro level as traders saw rain damage in Australia potentially adding to global supply tensions and bringing more demand for European wheat.
March wheat BL2H2, the most active contract on Paris-based Euronext, was down 6.25 euros, or 2%, at 302.50 euros ($342.25) a tonne by 1604 GMT.
The contract on Wednesday had reached 311.50 euros, a record for a second-month position BL2c2.
December BL2Z1 was down 1.8% at 300.00 euros, pulling away from Wednesday’s peak of 313.50 euros that was an all-time high for a Euronext contract.
“With the southern African variant we’ve slipped back to 300 euros,” a European trader said. “But there is still concern about Australia’s crop.”
This month’s rally has been fanned by doubts over quality in Australia’s harvest, which wheat markets have been counting on to help cover brisk international demand.
“The debate is still about EU export prospects as Australia’s crop suffers from rain,” a German trader said.
“Russia has again raised its wheat export taxes today, Russia has a tax of $80.8 a tonne in early December which looks like a big burden on new Russian export sales.”
In Germany, standard 12% protein wheat for January onwards delivery in Hamburg was offered for sale at around 5 euros over Euronext March, with buyers offering around 1 euro over.
Algeria led German wheat exports in November, with four ships having each loaded about 30,000 tonnes and another set to load about 30,000 tonnes next week, traders said.
One ship has loaded 63,000 tonnes for Iran, with single shipments of 50,000 tonnes for Nigeria, 30,000 tonnes for Morocco and 30,000 tonnes for Guinea.
($1 = 0.8839 euros)
(Reporting by Gus Trompiz in Paris and Michael Hogan in Hamburg; Editing by Edmund Blair and Louise Heavens)
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