High prices mar US, EU wheat demand

SEOUL/LONDON: European wheat prices tracked Chicago futures lower on Monday on concern that global demand for wheat was beginning to slow due to high prices, traders said. In Paris, benchmark March milling wheat futures closed off E2.75 or 1.1% at E250.25 a tonne in relatively quiet business.

The market closed early on the eve of Christmas. “There’s a bit of bearish news around with the cancelling of some tenders and that’s putting the market under pressure,” one European trader said.

March wheat on the Chicago Board of Trade was down 7-1/2 cents at $9.41-1/2 per bushel, around 6 cents off the low hit during Asian trading hours. Fears of tight global supplies lifted Chicago wheat prices above $10 a bushel for the first time early last week.

Wheat was also pressured by bearish news from Argentina, where the Agriculture Secretariat left its forecast for the 2007-08 wheat crop at 15.4 million tonnes — unchanged from a month ago, despite recent fears that frosts may have damaged the crop.

And China’s grain output exceeded 500 million tonnes this year, the fourth consecutive year of rising output, the official Xinhua news agency quoted minister of agriculture Sun Zhengcai as saying on Saturday.