Euronext Wheat fell for the third day on Tuesday, to its lowest level in over four months. Traders said that competition from cheaper Black Sea wheat supplies outweighed disappointing western European harvests.

The December wheat price on Euronext was 1.3% lower at 219,50 euros (241,85 dollars) per metric ton.

As it broke the 220 euro chart level, the contract fell to its lowest price since late March of 219.25 Euros.

After reaching their lowest level since March, September futures dropped even more, falling 2.1% to 206.25 euro.

Adjustments were made to the front-month position before Thursday's expiration of options on the contract.

FranceAgriMer, the farm office, said that the quality of wheat in France was mixed, particularly for the test weights.

The traders noted that despite a smaller export surplus, France needed to find demand overseas. In addition, uneven quality could force suppliers to lower prices.

A futures dealer stated that "France must find a market to sell the crop we have." There were exports of old crops in July, but we need another wind.

The bearish mood was exacerbated by the slow start of the EU wheat export season and imports from Ukraine in early-season wheat and maize.

Traders monitored direct talks between Egypt's suppliers and Egypt. Black Sea wheat, including Russian wheat, was in competition as Egypt sought to add to its 280,000 tons Black Sea wheat that it purchased in a Monday tender.

On Wednesday, the price of Russian 11.5% protein for August/September Black Sea shipment ranged between $212 and $215 per ton FOB. The Russian 12.5% protein cost around $218 to $222 per ton.

This week, the rain-delayed harvest of wheat in Germany is expected to be completed.

One Polish trader stated that yields could be as much as 10-15% lower in Poland than the previous year. "The quality of Polish wheat is generally good, but feed wheat will likely be higher than expected."

The price of Polish 12,5% protein wheat delivered to ports in August/September fell by 20 zloty per week, to about 900 zloty (210.9) euros a ton due to a thin export demand.

The trader said that the activity in Poland was low, as farmers were reluctant to sell, and exports were slow. He estimated new-season wheat sales by 24 July at 181,000 tonnes, which is only one third of last season's volume.

(source: Reuters)