European Wheat Prices Dip as Stronger Euro Weighs

Wheat Futures Retreat from Two-Month High

European wheat futures declined on Tuesday, pulling back from a two-month high. March milling wheat on Euronext's Paris-based market settled at 193.25 euros per metric ton, a decrease of 0.1%, after a strengthening euro weighed on prices.

Market Overview

The primary driver for the price dip was the euro gaining strength against the U.S. dollar, which makes European exports more expensive for international buyers. This currency fluctuation is critical amid intense export competition between European and Black Sea origins, particularly in key import markets like Egypt where pricing is nearly identical.

Impact on Exports

According to official EU data, soft wheat exports for the season reached 12.82 million metric tons, remaining stable year-over-year. However, traders noted that French and Black Sea wheat prices are nearly at parity for delivery to Egypt, meaning slight shifts in currency exchange rates or futures could significantly alter market dynamics and trade flows.

Summary

Market participants will continue to monitor currency fluctuations and futures movements closely, as these factors are the key determinants of export competitiveness in the near term.

FAQ

Q: Why did European wheat prices fall?
A: The primary reason was the strengthening of the euro against the U.S. dollar, which negatively impacts export competitiveness.

Q: What was the closing price for March milling wheat?
A: The contract on the Euronext exchange settled at 193.25 euros per metric ton.

Source: Investing.com