Bloomberg - European Wheat Holds Gains as Black Sea Woes Boost Demand

Bloomberg - European Wheat Holds Gains as Black Sea Woes Boost Demand

By Eleanor Thornber

(Bloomberg) -- European wheat futures held on to gains amid
strong demand for grain from the region, with supplies from
Russia and Ukraine constrained by continued hostilities in the
Black Sea.

The most-active futures on Euronext in Paris gained as much
as 0.4% at the open before pulling back slightly. Prices are
currently near a one-month high.

Sharply reducedexports from Russia and Ukraine are pushing
buyers to seek alternatives, a shift that could persist if risks
spread across more of the Black Sea. Europe’s soft wheat exports
are up 1% year-on-year, the latest data show, despite heat and
drought damaging the crop this year.

“The Black Sea is the big market driver,” said Mike Verdin,
senior markets consultant at CRM AgriCommodities. “Europe,
geographically as much as anything else, is the default origin.”
Still, the continent doesn’t have huge amounts to spare,
Verdin said, and that’s adding support to prices.

The euro’s slump has also played a role, making European
wheat cheaper for buyers paying in dollars.