Paris wheat falls on world financial market meltdown, strong euro

Published On : 08/05/2024

HAMBURG/PARIS (Reuters) -Euronext wheat futures fell on Monday, pressured by a stronger euro and economic fears sweeping through financial markets, though losses in grains were seen as curbed by short positions already held by investors.

Front-month September wheat on the Paris-based Euronext exchange closed down 1.7% at 216.00 euros ($236.65) a metric ton.

“There’s the idea we could face an economic downturn. The euro is not helping either” one futures dealer said.

“But funds are already very short in grain that they don’t need to add to that,” he said.

Prospects for a large harvest in Russia continued to temper concerns about a poor French crop, increasingly expected to plunge to its smallest volume since the 1980s at around 25-26 million tons, dealers said.

Traders await the French harvest to be completed in major northern belts, with showers last week delaying field work and heightening concern about quality damage.

Rapeseed on Euronext fell more sharply, with oilseed markets seen as more sensitive to wider macroeconomic sentiment and a holiday closure for Canadian futures focusing selling pressure on Paris, dealers said.

November rapeseed closed down 4.0% at 453.25 euros, but held the 450-euro chart floor.

Germany’s wheat harvest was repeatedly interrupted by rain in the past week, raising fears about damage to crop quality, although there is still time to recover.

“Some southern German regions like Bavaria which were the first to start harvesting may have suffered quality damage because of the rain but northern and eastern regions are looking better,” one German trader said.

“The picture in Germany is probably not as bad as the rain problems suffered by France’s harvest. There is still a lot of wheat left in the fields in Germany and concern is increasing about quality loss.”

($1 = 0.9127 euros)

(Reporting by Michael Hogan in Hamburg and Gus Trompiz in Paris; editing by Jonathan Oatis and David Evans)

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