September 5, 2014
EU wheat prices are at a lower record on September 3 with those of UK dropping to a four-year low as a possible de-escalation to the current Ukraine-Russia regional crisis has eased concerns over supply disruption, according to a Reuters report.
Dealers also noted that favourable weather is boosting the outlook for the UK wheat harvest which is now in its latter stages, with a crop of more than 16 million tonnes widely anticipated, sharply up from just 11.9 million tonnes in 2013. A larger crop should allow Britain to resume its traditional role as a net wheat exporter after a two-year hiatus.
In the meantime, November wheat futures in London ended US$2.45 lower at US$194.90, the weakest for the front month since July 2010.
Prices in Paris, France were also lower. November wheat on the Euronext futures market settled US$3.23, or 1.4% lower.
In another development, the state buyer in Egypt, the world's top wheat importer, purchased French wheat for the first time in nearly eight months, a move which helped Euronext futures pare losses. Egypt's General Authority for Supply Commodities (GASC) bought 60,000 tonnes of French wheat along with 60,000 tonnes of Romanian wheat.
However, the winning sale price was significantly below competing French offers and seen as unrepresentative of a French market which has been coping with a mixed crop quality from a weather-hit harvest.
Prices had already been dampened this week by confirmation of strong exports from both Ukraine and Russia since the start of the 2014/15 season in July.
"The wheat price is gradually shedding the gains it achieved on the back of the Ukraine-Russia conflict...it appears that the conflict has so far had no negative impact on grain deliveries from the Black Sea region," Commerzbank said.