June 15, 2009
EU wheat follows US market lower inline with commodities complex
European wheat futures followed the US market lower Friday (June 12), having now erased all of the gains made during last month's commodity rally.
Talk of "green shoots" indicating the beginnings of a macroeconomic recovery were overstated and the markets have responded accordingly, said a London-based broker.
Paris November milling wheat closed down EUR3.75, or 2.5 percent, at EUR147.75 a tonne, with 4,880 lots moved. London November feed wheat closed down GBP2.85, or 2.3 percent, at GBP118.75/tonne, with 699 lots moved.
There's "no recovery in sight yet," said UK farmer-owned cooperative Openifield.
Talk of large carry-over stocks from the 2008-09 crop continues to weigh on the market, although some analysts are becoming slightly more optimistic about demand.
"Fundamentals are improving in agriculture and oil markets, where the worst of the demand downgrades are behind us and market focus is shifting back towards the supply constraints," said Barclay's Capital in a commodities note on Friday.
Standard-quality wheat prices in the French cash market delivered at Rouen were flat on Thursday's prices at EUR135/tonne.
Liffe's Paris August rapeseed traded down EUR3.50, or 1.1 percent, at EUR315.75/tonne with 562 lots traded. Paris August corn traded down EUR4.50, or 3 percent, at EUR149.00/tonne, with 73 lots moved.
