November 27, 2009

 

EU Wheat: Down slightly, tracking weakness in outside markets

 

 

European wheat futures traded lower Thursday (November 26), tracking weakness in equity markets and across the commodity complex.

 

"We're following outside influences ... wheat fundamentals are not the only driving forces," said a London-based broker, adding that the market will have to come back to trading on fundamentals but it's impossible to forecast when this will happen.

 

The recent rally in gold prices has triggered index funds to rush into commodities, said the broker.

 

Paris January milling wheat futures ended down EUR2.25, or 1.7 percent, at EUR131.00 (US$196.01) a tonne, with 2,552 lots moved. London May feed wheat closed down GBP0.15, or 0.1 percent, at GBP112.60/tonne, with 356 lots moved.

 

With US markets closed for the Thanksgiving holiday and a lack of fresh news, European markets lacked direction throughout the session.

 

"It's likely to be quiet tomorrow also as people will be wary of getting too exposed to the market" while people in the US are taking long weekends, said a London-based broker.

 

The International Grains Council said world wheat plantings are expected to fall 1.5 million hectares on the year to 222 million hectares in 2010, but also raised production expectations for 2009-10 by 1 million tonnes to 668 million tonnes.

 

Standard-quality wheat prices in the French cash market delivered at Rouen were up EUR1 from Wednesday at EUR124/tonne.

 

Paris-based February rapeseed traded down EUR1.25, or 0.4 percent, at EUR280.50/tonne, with 810 lots moved. Liffe's Paris January corn traded down EUR0.75, or 0.6 percent, at EUR135.00/tonne, with 107 lots moved.

 

US$1 = EUR0.68 (Nov 27)