MADRID, March 21 (Reuters) – Benchmark European wheat prices recovered from earlier losses in late dealing on Wednesday in step with a similar move on the influential Chicago futures market. * By 1638 GMT milling wheat futures traded on the Euronext exchange in Paris were up across the board <0#BL2:>, with the front month May contract gaining 0.75 euro, or 0.36 percent, to 209.50 euros ($276.31) a tonne. * “We are following Chicago although only soybeans are really rising,” a trader said. * Traders noted contradictory reports over how competitive European wheat was, with some saying demand was good and regular, while others said Algeria and Morocco had snubbed European wheat in recent heavy buying. * On the supply side, grain farmers in western Europe are keeping their eyes on rain forecasts as concerns mount that persistent drought could further cut yields following frost damage earlier this year. * French grain growers group Orama said on Tuesday frost had damaged 700,000 hectares, or 8 percent, of all winter grain and oilseed acreage in France -mainly wheat, barley and rapeseed – which may need to be resown. * But some traders said this estimate was too pessimistic and the damage remained difficult to assess. SPAIN * Spanish physical wheat posted mild gains in a delayed reaction to recent gains in Paris and Chicago, which are making imports more expensive for theimport-dependent country. * “Importers have stepped on the price accelerator, waiting for buyers to come to them, and without giving an inch,” a report from the Mercolleida agricultural exchange said. * “The basic problem is it is assumed it will cost them over the odds to charter new shipments, because prices are rising in the Black Sea.” * Black Sea countries are Spain’s favourite suppliers, especially Ukraine, when special import licences are available. * However, U.S. wheat has recently gained an unusual foothold in Spain due to competitive pricing and reported hold ups of Black Sea grain due to coldweather. * Prompt imported feed wheat was last heard changing hands at 229 euros a tonne, ex-store, in key grains port Tarragona, up 2 euros from Friday. * Dealers said concerns over damage to the 2012 wheat harvest from a persistent drought was driving prices inland. * Old crop feed wheat was quoted up 5 euros on the week at 223 euros/tonne in Burgos, Spain’s main wheat producing province. GERMANY * German wheat was thinly traded as the Paris market provided little fresh direction, but strong feed wheat prices again gave background support to milling wheat. * Standard-quality milling wheat for March delivery in Hamburg was offered for sale unchanged at 217 euros a tonne, with buyers at around 215 euros. * Demand from animal feed makers kept German feed wheat prices around or even above milling wheat in parts of the country, repeating a pattern seen in past weeks. * Feed wheat for nearby delivery in the South Oldenburg market near the Netherlands was offered above milling wheat at 222 euros a tonne, with buyers at around 220 euros. * “Demand from animal feed makers remains strong which is underpinning the milling wheat market,” a German trader said. “If transport costs allow, farmers are selling milling wheat for feed.” * “Background export demand also looks good following recent sales to Iran.” * The unexpectedly low feed grain exports in past weeks from the Black Sea region have transferred buying interest back to EU feed wheat, with Spanishpurchasers recently buying German feed wheat. * Prices at 1649 GMT Product Last Change Pct Move End 2011 Ytd Pct Paris wheat 209.50 0.75 +0.36 195.25 7.30 London wheat 170.25 0.25 +0.15 153.65 10.80 Paris maize 212.00 0.50 +0.24 197.25 7.48 Paris rape 453.00 1.75 +0.39 421.50 7.47 CBOT wheat 650.75 -0.75 -0.12 671.25 -3.05 CBOT corn 644.00 -2.00 -0.31 654.75 -1.64 CBOT soybeans 1360.75 8.50 +0.63 1207.75 12.67 Crude oil 106.99 0.92 +0.87 98.83 8.26 Euro/dlr 1.32 0.00 -0.17 1.30 1.91 * All grain and oilseed prices for second position. Paris futures prices in Euros per tonne, London wheat in pounds per tonne and CBOT in cents per bushel. ($1 = 0.7582 euros) (Reporting by Martin Roberts in Madrid, Valerie Parent in Paris and Michael Hogan in Hamburg; Editing by Alison Birrane)
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