HAMBURG/PARIS - Algeria’s state grains agency OAIC is believed to have purchased around 600,000 metric tons of milling wheat in an international tender which closed on Wednesday, European traders said on Thursday.

This was at the higher end of trader estimates of the purchase on Wednesday evening, which ranged from 500,000 to 600,000 tons. There were still individual estimates of 580,000 tons on Thursday, but most traders estimated 600,000 tons.

Traders on Thursday again said all of the purchase was made at $258.50 per ton cost and freight (c&f) included, the same as estimated on Wednesday.

Traders suspected much of the wheat would be sourced from the Black Sea region, although technically the grain can be sourced from optional origins. Expected origins included Romania, Bulgaria and Ukraine.

Argentine wheat, currently very cheap, was also named as a possible origin, but November/December shipment could be too early for Argentina’s new crop, traders said.

The wheat is sought for shipment in two periods from the main supply regions including Europe: December 1-15 and December 16-31. If sourced from South America or Australia, shipment is one month earlier.

Reports reflect assessments from traders and further estimates of prices and volumes are possible later.

Traders said wheat from France, in past years a huge supplier to Algeria, was again in reality excluded from the tender, although no official announcement has been made.

Traders say diplomatic tensions, sparked by Paris' recognising Morocco's sovereignty over Western Sahara, have led OAIC to tacitly exclude French wheat and companies in its import tenders in past months. OAIC has said it treats all suppliers fairly.

French wheat could be supplied at the $258.50 per ton c&f purchase price, a trader said. French, Russian, Romanian and Ukrainian wheat are all currently priced almost the same for December shipment at $226 to $229 a ton FOB.

(Reporting by Michael Hogan in Hamburg and Gus Trompiz in Paris; Editing by Joe Bavier)