Euronext wheat recovered from a 2-week low on Wednesday as traders downplayed the immediate impact of an American-backed agreement on Black Sea shipping.

Euronext was also boosted by the easing of the euro, as traders saw better export prospects for Western European Wheat, particularly in Morocco.

Euronext's May wheat settled at a 0.8% increase at 222.00 Euros ($238.87). It had previously touched its lowest price of 219.50 Euros since March 12.

As a result of negotiations led by the United States, agreements were reached with Russia and Ukraine to protect maritime commerce through a Black Sea truce.

The initial negative reaction to the Black Sea deal, based on the notion that it could increase competition in export markets, waned as traders saw that there was little room for increasing the already existing Black Sea trade, and questioned whether Russian conditions would be met.

One German trader stated that "the market reaction to the Black Sea Shipping Agreement looks reserved, as so many details are still to be determined and there is a lot scepticism regarding whether a wide agreement will be achieved."

The European Union's refusal to lift some financial sanctions in order to facilitate Russian agricultural exports also cast doubt on the implementation of the Black Sea Deal.

The grain markets also awaited the planting and stock data from the United States on Monday as well as any further developments regarding President Donald Trump’s tariff offensive.

A French trader stated that the market was trying to find its direction, as there is a lot of uncertainty about Trump's decision and the competition for U.S. soybean and corn planting acres.

Morocco has been the top destination for wheat exports in March, both from Germany and France. Three ships, each with 30,000 tons of wheat, have already loaded.

Morocco announced this week that it would extend the current subvention programme for soft wheat imported until December.

The Black Sea region traders have reported a muted response to diplomatic developments. Russian and Ukrainian prices are down by around $2 per ton in line with Euronext and Chicago.

For April/May deliveries, Russian protein wheat 11.5% was about $243-$245 per ton FOB. Russian wheat 12.5% was about $248-$250. Ukrainian 11.5% wheat cost about $240-242.

Data showed that financial investors reduced their net short positions in Euronext Wheat last week. However, traders still noted the fact that the net short of investment funds was near a record.

(source: Reuters)