European traders reported on Wednesday that Algeria's state grain agency OAIC purchased between 810,000 to 840,000 metric tonnes of milling wheat at an international auction on Tuesday.

The estimate of 800,000 tonnes by traders on Tuesday night was lower. On Wednesday, some estimates were as high at 900 000 tons.

The majority of traders reported prices between $279 and $279.50 per ton including cost and freight. On Wednesday, some price estimates were as low at $278 per ton including cost and freight (c&f).

Wheat is optional, but traders were expecting a large supply from the Black Sea Region, which includes Ukraine, Romania and Bulgaria, as well as possibly Russia.

The best sources of supplies for the Black Sea were non-Russian suppliers.

The unofficial export price set by the Russian government to cool down flour prices and restrain Russian exports was said to be a factor. It was reported that the unofficial export price also kept Russian offers at $285 per ton c&f during an Egyptian wheat auction on Tuesday.

The Algerian wheat tender expected some wheat to come from France or Germany.

The reports reflect the opinions of traders. Further estimates on prices and volume may be made later.

Algeria requested wheat for two periods of shipment from main supply regions, including Europe: August 1-15 and August 16-31. The wheat is shipped a month sooner if it comes from South America or Australia.

Algeria is a major buyer of wheat from the European Union and France. However, Russian exporters as well as those from other Black Sea regions are expanding rapidly on the Algerian market.

Algeria's previous large-scale purchase of soft wheat, reported on 3 May, included between 240,000 to 300,000 tonnes of milling grain at a cost of $249 per ton c&f.

Prices have risen by 10 months since then due to concerns about weather damage in Russia. Reporting by Michael Hogan, Hamburg; Gus Trompiz, Paris. Editing by David Goodwin.