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What are the markets reacting to?

На какво реагират пазарите?

Euronext wheat was lower, capped by a stronger euro, in addition to traders also awaiting clearer indications on harvests and the Black Sea transport corridor from Ukraine, dealers said.

"Low prices for Russian wheat and also Romanian wheat are a factor, but the market faces some uncertain developments," said a German trader.

"Ukraine's shipping agreement expires in less than a week and no one knows if an extension will happen," added a colleague. Demand is generally weak amid competition in the Black Sea, and low Rhine levels are adding new costs, local analysts said.

In France, traders were waiting for the harvest to speed up in the hot weather that settled in after the recent storms. French farmers have harvested 21 percent of this year's soft wheat crop by July 7, agricultural service FranceAgriMer said.

Soufflet Agriculture said in a separate crop update that there were good early yields and quality in wheat, but canola yields were disappointing, on the back of last year's high levels.

In Poland, prices rose due to increased commercial interest and uncertainty about the size and quality of the new crop. Exporter buying prices for wheat with 12.5% ​​protein rose by 5 zlotys this week to around 1,015 zlotys (€227) per tonne, for delivery in July/August to ports.

We recall that the EU cut its June forecast for soft wheat production by 2.681 million tonnes from its May forecast to 129.879 million tonnes, largely due to reduced yields in Poland.

The new forecast is 2% below last year's figure, but 4% above the 5-year average. The main reductions were attributed to Lithuania, where the forecast was reduced by 705,000 tonnes, Poland (down by 492,000 tonnes), Latvia (down by 416,000 tonnes), Bulgaria (down by 314,000 tonnes) and Romania (down by 284,000 tonnes ).

Austria, Denmark, Estonia, the Czech Republic and Spain reported a combined reduction of 511,000 tonnes, split roughly equally between the five.

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