European wheat futures declined on Monday, as an Egyptian import bid kept attention on the competitive Black Sea supply. Expectations that U.S. crop forecasts would increase in a report by the government also weighed on sentiment.

The December wheat position, which was the most active on Paris' Euronext exchange, had fallen 1.6% to 223.00 Euros ($243.47 per metric ton) by 1414 GMT.

Egypt's massive tender for 3.8 million tons wheat to be shipped between October and April is likely to feature a lot of Black Sea wheat, including Russian wheat. This follows the tender last week by Algeria, another importer.

The traders reported that 15 suppliers had submitted bids for the Egyptian tender. Ukrainian wheat was the most affordable, and the limited French wheat offers were much more expensive.

A plentiful supply of Black Sea wheat at competitive prices has diverted attention from the dire harvest in France. The farm ministry predicts that the main wheat crop will reach its lowest volume ever since the 1980s, with 26.3 million tonnes.

A futures dealer stated that only the Black Sea was in the running to export grain. It's going be a grim year for the French grain industry unless Russian prices start to rise.

French farmers, who have already protested earlier in the year, are now facing a triple blow. The production is hampered by rain and prices are low.

The traders noted that despite the renewed Russian attacks against port zones, exports continued from war-torn Ukraine.

A German trader stated that "Ukrainian shipments move into the international markets in large volumes".

The U.S. Department of Agriculture will release its monthly world crop report on Wednesday at 1600 GMT. In this report, the USDA is expected increase their estimates of U.S. corn, wheat and soybean production.

Chicago futures have fallen to their lowest level since 2020 due to favorable harvest prospects. Corn and soybeans also reached new lows on Sunday.

A hot spell in Western Europe allowed German and French producers to accelerate their fieldwork.

Another trader stated, "I believe that about 80% (of Germany's) wheat has been collected with great progress in the past days."

Traders said that the recent rain would have likely reduced production in Germany. Market estimates put production at between 19 and 19,5 million tons, and traders estimated that up to one percentage point of protein may have been lost.

(source: Reuters)