European wheat fell to a near two-year low on Friday, pressured by strong competition from Black Sea origins, due partly to the rise of the euro against the dollar and weak demand, traders said.
Benchmark December milling wheat on Paris-based Euronext, closed 1.5% lower at 218.75 euros ($238.59) a metric ton, a price not seen since Dec. 20, 2021.
“The euro’s strength is a depressing factor, making our exports more expensive in the face of relentless low-price competition from Russia and elsewhere in the Black Sea,” one German trader said.
“Russian wheat exports are still running at over 1 million tons a week in November with prices today way below the west EU.”
Russian export prices on Friday for December shipment from the Black Sea were around $230 a ton FOB for 11.5% protein and about $235 a ton FOB for 12.5% protein.
Two traders also said that Chinese importers had asked sellers of French wheat for December shipment to delay shipments to February and March in the new year.
“This is a factor weakening Euronext. I think some silo operators in France could have difficulty in this as they had scheduled the China sales to clear capacity,” a German trader said.
In Poland, prices fell amid slack demand and a strong local currency.
Export prices for 12.5% protein wheat dropped fell by 30 zloty on the week to around 935 zloty (213.6 euros) a ton for November/December port delivery.
Poland’s wheat export shipments were busy, largely of old business, including a rare shipment of 25,000 tons of wheat from Szczecin to Albany in the United States, traders said. U.S. importers made large purchases of EU wheat earlier this year.
“Domestic demand is weak while grain stocks are high,” a Polish trader said. “A lot of demand from Germany and the Netherlands previously handled by Poland is covered now by Ukrainian grains crossing Poland in transit.”
Polish truck drivers are blockading three border crossings with Ukraine, protesting against the loss of business to Ukrainian competitors since the war with Russia started. But other crossings are still open.
“The blockages are a political problem about trucker earnings, but nevertheless there is some impact on the grains business,” the trader said. “The Ukrainian trucks have been waiting 5-6 days at the border, the volume of transit grains is falling.”
Ukrainian grains are not sold inside Poland but are transited to export ports and the west EU.
