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PARIS, Oct 21 (Reuters) - Wheat prices in western Europe rose on Friday, supported by the euro's fall to a seven-month low against the dollar that made European wheat more competitive overseas.
Benchmark Paris futures were rangebound, however, as the market was curbed by lacklustre export activity in France after this year's poor harvest and as technical resistance capped gains after a seven-week high at the start of the week.
December milling wheat
The wide premium for CME over Euronext has reflected stronger domestic demand in France compared to anemic export activity.
Port data showed very few scheduled export loadings, particularly at Rouen, usually Europe's biggest grain export terminal, fuelling talk that silos there may resort to temporary layoffs.
The euro extended a drop against the dollar to its lowest since March 10 at below $1.09, making grain from the euro zone cheaper for overseas buyers.
The currency weakness could favour German wheat, which has led EU exports this season in the absence of normal French flows.
"The euro at around $1.08 could certainly make a difference in export markets compared to the $1.12 at the beginning of October," one German trader said.
"After big purchases by Saudi Arabia and Algeria in the past week which could include German wheat, optimism is growing that other importers of high quality grades could look towards Germany."
Black Sea origins again dominated a tender held on Thursday by Egypt. But the purchase of 120,000 tonne of Russian wheat confirmed a return to regular trade with Egypt after tensions over import policy and also helped absorbed more of a large surplus in the Black Sea region, traders said.
Standard wheat with 12 percent protein content for November delivery in Hamburg was offered for sale at 2.5 euros over the Paris December contract against two euros over on Thursday. Buyers were seeking 1.5 euros over.
Weekly data from farm office FranceAgriMer showed French farmers had sown 43 percent of the planned soft wheat area by Oct. 17, up from 23 percent a week earlier but trailing the 52 percent progress seen a year ago.
(Reporting by Gus Trompiz; Editing by Susan Fenton) ((gus.trompiz@thomsonreuters.com; +33 1 49 49 52 18; Reuters Messaging: gus.trompiz.thomsonreuters.com@reuters.net))
Benchmark Paris futures were rangebound, however, as the market was curbed by lacklustre export activity in France after this year's poor harvest and as technical resistance capped gains after a seven-week high at the start of the week.
December milling wheat
The wide premium for CME over Euronext has reflected stronger domestic demand in France compared to anemic export activity.
Port data showed very few scheduled export loadings, particularly at Rouen, usually Europe's biggest grain export terminal, fuelling talk that silos there may resort to temporary layoffs.
The euro extended a drop against the dollar to its lowest since March 10 at below $1.09, making grain from the euro zone cheaper for overseas buyers.
The currency weakness could favour German wheat, which has led EU exports this season in the absence of normal French flows.
"The euro at around $1.08 could certainly make a difference in export markets compared to the $1.12 at the beginning of October," one German trader said.
"After big purchases by Saudi Arabia and Algeria in the past week which could include German wheat, optimism is growing that other importers of high quality grades could look towards Germany."
Black Sea origins again dominated a tender held on Thursday by Egypt. But the purchase of 120,000 tonne of Russian wheat confirmed a return to regular trade with Egypt after tensions over import policy and also helped absorbed more of a large surplus in the Black Sea region, traders said.
Standard wheat with 12 percent protein content for November delivery in Hamburg was offered for sale at 2.5 euros over the Paris December contract against two euros over on Thursday. Buyers were seeking 1.5 euros over.
Weekly data from farm office FranceAgriMer showed French farmers had sown 43 percent of the planned soft wheat area by Oct. 17, up from 23 percent a week earlier but trailing the 52 percent progress seen a year ago.
(Reporting by Gus Trompiz; Editing by Susan Fenton) ((gus.trompiz@thomsonreuters.com; +33 1 49 49 52 18; Reuters Messaging: gus.trompiz.thomsonreuters.com@reuters.net))
