August 28, 2008

 

 

Liffe's European wheat futures dropped Wednesday (August 27), making it the fourth straight lower session for Paris milling wheat.

 

The drop was due to further spillover weakness from the US markets and early strength in the euro.

 

Paris November wheat fell EUR3, or 1.6 percent, to end at EUR188.75 a tonne with 4,039 lots moved. November set a two-week low of EUR188.25/tonne.

 

London November feed wheat dropped GBP1.90, or 1.5 percent, to end at GBP122.10/tonne. This left the contract within striking distance of its recent range low of GBP121/tonne.

 

Recent weakness in the euro has provided underlying support for prices in Paris, but early session strength versus the US dollar gave would-be bulls some jitters to weigh on the market, a London-based broker said.

 

Losses were then extended as CBOT wheat futures, a global benchmark, also dropped for the fourth session straight.

 

And while the recent euro weakness has been helping make French wheat market attractive against Black Sea and US wheat prices, the broker said French wheat was still looking a bit pricey versus the UK market.

 

A turn to more favourable harvesting weather in the UK has also eased some nearby local market concern.

 

Despite recent rain delays, the National Farmers Union of England and Wales said crop quality has not been too badly affected. NFU estimated harvest in the key-producing East Anglia region of eastern England at about 25 percent done versus about 90-100 percent normally.

 

Liffe's Paris-based November corn fell EUR0.75, or 0.4 percent, to end at EUR177/tonne, with 95 lots moved. Meanwhile, November rapeseed rose EUR6.25, or 1.6 percent, to end at EUR401.25/tonne with 1,595 contracts traded.