EU Wheat Rises After News Egypt Bought French Wheat

European wheat edged higher on Tuesday, helped by Egypt’s purchase of French wheat in its latest tender.

By 1457 GMT November wheat on the Paris-based Euronext futures was 0.50 euro or 0.3 percent higher at 162.00 euros a tonne.

The contract had been in negative territory before the results of the tender, reacting to a fall on US wheat markets to contract lows.

Egypt’s state grain buyer, the General Authority for Supply Commodities (GASC), said on Tuesday it bought 180,000 tonnes of French wheat in a tender.

It was the first time in nearly nine months that GASC had bought three cargoes of French wheat in a tender.

But traders noted that the sale had been done at low prices, due to heavy negotiations with Cairo. There was an $8 per tonne spread between the best French offers submitted in the tender, offering GASC room for manoeuvre.

“They sold at a very aggressive level,” one trader said. “It shows the willingness to get some French wheat out.”

Poorer quality French wheat after a rain-drenched harvest has prompted farm office FranceAgriMer to forecast wheat exports onto the world market could drop by a third in 2014/15 from the previous year, and the country’s stocks jump by two-thirds.

In other news, one of Russia’s leading agriculture consultancies, SovEcon, said Moscow’s import ban on most Western food, the assimilation of the disputed Crimea region and an influx of people fleeing conflict in Ukraine were set to boost Russian grain demand this year.

However, despite rising domestic demand, Russia’s 2014/15 grain exports could still reach a record 30.5 million tonnes, including flour, it added. The estimate was 2 million tonnes higher than its previous forecast.

Source : brecorder