EU wheat eases on euro jump and tariff jitters

Reuters
04-04
EU wheat eases on euro jump and tariff jitters

PARIS, April 3 (Reuters) - Euronext wheat futures eased on Thursday as the euro climbed and traders awaited potential trade disruption following the announcement of sweeping U.S. tariffs.

May wheat BL2K5 on Euronext settled 0.5% down at 221.00 euros ($243.54) a metric ton, after paring early losses.

The euro EUR= jumped to a six-month high against the dollar after U.S. President Donald Trump unveiled broad tariffs that fanned market fears of a global recession. FRX/

"Markets continue to digest the impact of these (tariffs), with the pound and euro both firming as a result," British merchant ADM Agriculture said in a note.

"All eyes are now on the expected raft of retaliatory tariffs which are expected, particularly from China, Japan and the EU."

The euro's rise cooled recent expectations that Western European wheat could win fresh export sales after a one-year low on Euronext last week.

Uncertainty over the effects of proposed tariffs, as well as ongoing holidays in parts of the Middle East, were also dampening demand, traders said.

“One thing that did not happen today was a sudden burst of wheat purchase tenders being issued to take advantage of price falls. The demand side is weak,” a German trader said.

“Overall, it looks like importers assess that prolonged tariff disputes will push prices down so they may be able to buy cheaper later,” he said.

Forecast rain in the Black Sea region, which should alleviate drought, was also keeping a lid on wheat prices, traders said.

Rapeseed futures on Euronext fell more sharply than wheat, as oilseeds markets anticipated possible retaliatory measures by China against U.S. soybeans.

May rapeseed COMK5 ended 1.2% lower at 517.75 euros a ton.

($1 = 0.9074 euros)

(Reporting by Gus Trompiz in Paris and Michael Hogan in Hamburg, editing by Deepa Babington)

((gus.trompiz@thomsonreuters.com))

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