PARIS, June 18 (Reuters) – French sales to China, a big
expected Romanian crop and competitive prices for German and
Baltic supplies should yield brisk EU wheat shipments at the
start of next season while an export levy clouds Russian
prospects, analysts and traders said.

“The signs are pretty favourable,” Laurent Crastre, wheat
analyst with Strategie Grains, said. “EU supply is going to be
very healthy.”

Showers and hot weather in the past month have put the bloc
on course for a bigger wheat crop this year.

Competitive prices are helping early EU export sales for the
new season that begins in July, particularly as a variable
export tax in Russia complicates pricing of what is also
expected to be a large Russian harvest.

“If the Russian export barriers remain, some of the demand
will be switched to the EU,” a German trader said.

Strategie Grains last week raised sharply its forecast for
EU soft wheat exports, citing attractive prices in Romania and
Bulgaria as well as Germany, Poland and the Baltic states.

Heavy rain in Romania could hurt harvest quality, but the
country would still find ready markets given tight global supply
of feed grains, according to traders and analysts.

France, the EU’s largest wheat exporter, is set to be a
large supplier of China for a third straight season.

After traders reported Chinese purchases of up to 1 million
tonnes of French new crop earlier in spring, they cited a
further round of deals in late May thought to cover between two
and five panamax vessels, or up to 300,000 tonnes.

However, Chinese demand has also pushed up French prices,
raising doubts among traders about whether France will be able
to sell enough to other destinations.

Other question marks for EU prospects include any surge of
Russian supplies, a fluctuating euro-dollar rate and importers’
willingness to pay high grain and shipping costs.

But the outlook for EU suppliers is still bright.

The French focus on sales to China could allow German and
Polish wheat to claim more large exports to Algeria.

Iran is also expected to remain a major outlet for German
wheat while traders anticipate Turkey and Pakistan being active
importers to curb domestic prices.

“The demand side looks positive,” another German trader
(Reporting by Gus Trompiz and Michael Hogan; editing by
Jonathan Oatis)