European wheat futures were hovering near the previous session’s two-week low on Friday, with tightening global supplies and drought concerns in Europe offset by sluggish exports.
December milling wheat on Paris-based Euronext was unchanged at 201.25 euros a tonne by 1626 GMT, just above Thursday’s two-week low of 200.75 euros.
“There’s not enough news to shift the market,” one futures dealer said.
“For now, the warm weather is helping Russia export quickly. It may be more like early 2019 before western Europe gets its turn in exports. This could mean December futures come under pressure while March and May prices have more upward potential.”
Analysts are projecting that shipments by top wheat exporter Russia will ebb as the 2018/19 season progresses, boosting demand for wheat from western Europe and the United States.
However, current export activity in the European Union and the United States remains moderate and is particularly thin in France and Germany.
Dry conditions in France were raising concern that newly sown wheat will struggle to develop, but dealers said it was too early for the risk to be reflected in prices.
An unusually warm, dry start to autumn has deepened a summer drought in northern French grain belts and virtually no rain is forecast for the week ahead.
French farmers had sown 32 percent of the expected soft wheat area for next year’s harvest as of Oct. 15, compared with 39 percent at the same point last year.
November feed wheat futures in London were up 0.2 percent at 176.25 pounds a tonne, edging away from the 175 pound four-week low set on Thursday.
Supplies in Britain have been boosted by strong imports in the first few months of the 2018/19 season.
Customs data put UK imports in the first two months of the 2018/19 season at 515,487 tonnes while exports totalled only 50,020 tonnes.
“The domestic balance sheet is steadily becoming heavier,” David Sheppard, managing director of UK merchant Gleadell, said in a market note.