EU wheat futures higher "blindly following Chicago"
London-based feed wheat futures are £2.50-3.50 higher this morning despite the outlook for bumper crops in Europe. Paris-based milling wheat futures are EUR4.25-6.25 higher.
All around the European market place, traders warned fundamentals are very different between the U.S. and the European market.
While the U.S. corn and soybean crops struggle with flooding, bumper wheat harvests are expected to begin soon in the European Union, as well as in the Ukraine and Russia.
"Corn is so important for feeding animals, but the E.U. and Black Sea are set for a huge wheat crop," added the trader. "We are blindly following Chicago."
And despite recent movement on the futures market, cash trade remains very thin. Farmers have been hesitant to sell in hopes of higher prices and uncertainties over quality, especially after being burnt by quality-destroying rain during harvest last season. At the same time, consumers are without coverage, attempting to hold out for new crop stocks.
Estimates are that France's soft wheat harvest will be delayed by about two weeks due to fairly cool temperatures and ample moisture. This tends to lead to a much higher yields, but lower protein.
All around the European market place, traders warned fundamentals are very different between the U.S. and the European market.
While the U.S. corn and soybean crops struggle with flooding, bumper wheat harvests are expected to begin soon in the European Union, as well as in the Ukraine and Russia.
"Corn is so important for feeding animals, but the E.U. and Black Sea are set for a huge wheat crop," added the trader. "We are blindly following Chicago."
And despite recent movement on the futures market, cash trade remains very thin. Farmers have been hesitant to sell in hopes of higher prices and uncertainties over quality, especially after being burnt by quality-destroying rain during harvest last season. At the same time, consumers are without coverage, attempting to hold out for new crop stocks.
Estimates are that France's soft wheat harvest will be delayed by about two weeks due to fairly cool temperatures and ample moisture. This tends to lead to a much higher yields, but lower protein.
