Euronext wheat fell on Thursday as hefty global supplies cooled concerns over war disruption to Black Sea export flows, traders said.
December wheat on Euronext was down 1.7% at €227.75 ($262.23) a metric ton by 1623 GMT, giving up gains from Wednesday when it had rebounded from a three-week low.
The European market tracked a slide in Chicago where wheat futures fell more than 2% to a four-week low.
A big long position built up by investment funds in Euronext wheat has also made the market prone to bouts of liquidation, according to traders.
Euronext and Chicago futures hit two-year highs in late July as a surge in attacks on ships, ports and export terminals in the Black Sea started to hamper shipments.
Traders have been fearing in particular a halt to massive wheat exports from Russian deep-water ports.
But with shipments continuing from Russian ports and from Ukraine through alternative export routes, a backdrop of large global supplies has kept prices in check, traders said.
"The market is not pricing a shortage in three months' time," a futures trader said. "There is logistical disruption but grain is available."
Traders said disruption to Black Sea shipping influenced the outcome of an Algerian wheat tender on Wednesday, with the importer expected to receive little or no Russian wheat as part of a purchase estimated by traders at 540,000 to 720,000 metric tons.
"The consensus is that Romania and Bulgaria are likely to be the main supply origins, with possibly some Ukrainian delivered overland for shipment via Romanian ports," a German trader said.
"Cheap offers of Russian wheat were made but Russian looks unlikely to be supplied because of the uncertainty about delivery after the Ukrainian attacks on ports and shipping, with some vessel owners refusing to send ships to Russian Black Sea ports."
There was market talk, however, of possible Russian shipments to Algeria being made from Baltic Sea ports, the trader added.
The European market is also grappling with very low water levels on the Rhine and Danube rivers as drought grips the continent.
In crop news, commodity data firm Expana cut its estimate of this year's European Union soft wheat crop by 1.5 million tons to 126.8 million, while making a steeper cut to its forecast for the bloc's maize crop.
Prices at 1623 GMT | |||
Last | Change | Pct Move | |
Paris wheat | 227.75 | -4.00 | -1.73 |
Paris maize | 245.00 | -3.75 | -1.51 |
Paris rapeseed | 526.00 | 2.50 | 0.48 |
CBOT wheat | 628.00 | -14.25 | -2.22 |
CBOT corn | 458.50 | -1.50 | -0.33 |
CBOT soy | 1172.25 | -2.50 | -0.21 |
WTI crude oil | 77.75 | 2.53 | 3.36 |
Euro/dollar | 1.15 | 0.00 | -0.30 |
Most active contracts - Wheat, corn and soy U.S. cents/bushel, Paris futures in euros per metric ton |
($1 = 0.8685 euros)
(Reuters)