May milling wheat on the Paris-based Euronext exchange, the last delivery position for the 2016 harvest, was up 2.50 euros or 1.5 percent at 167.00 euros ($181.6) a tonne by 1602 GMT. Some market participants were closing short positions ahead of the expiry of the contract on May 10 to avoid physical delivery requirements, traders said, noting open interest was still relatively high with over 76,000 50-tonne lots as of Tuesday's close.
"For Matif, they have to show a storage certificate to the exchange by next Wednesday for May futures. With the long weekend, this means a stampede for the exit," one futures dealer said. Euronext will be closed on Monday due to a public holiday in several European countries. Chicago futures rose as spot prices continued a rebound from the $4 level touched this week and investors covered short positions in grains, encouraged by rain delays to US spring planting.
On Euronext, new crop prices were also higher, with September wheat up 1.25 euro or 0.8 percent at 168.00 euros. Uncertainty about the impact of dryness on this year's harvest was partly holding back sellers, traders said. "With the low price levels and weather risks, the co-operatives are not selling, whereas industrial consumers are looking to buy," another futures dealer said. "The recent price drop was too fast and too steep." In Germany, standard wheat with 12 percent protein content for May delivery in Hamburg was offered for sale at 8 euros over the Paris May contract. Buyers were seeking 7 euros over.
Copyright Reuters, 2017