Wheat prices fall, worrying France  The prices of many commodities have soared over the past few years, but an increasing number of wheat exporters is changing the worldwide market.

France is currently the world's second largest wheat exporter, but the Western European nation is facing mounting competition from countries across the globe as it works to shore up contracts with buyers elsewhere. Russia, Ukraine and Kazakhstan, among others, have ratcheted up their own production of the grain, and excess supplies are starting to affect prices.

Bloomberg reports France recently failed to secure more than 10 tenders in Egypt, which is the world's biggest buyer of wheat. France's position as top producer of wheat is threatened, according to analysts, because of burgeoning competition from countries in Eastern Europe.

Egypt is opting to purchase wheat from producers surrounding the Black Sea, as officials work to keep costs low. Wheat produced in France is more expensive, experts say, and its grain shipments have suffered as a result of the increased business on the other side of the continent.

In fact, government data indicates that wheat shipments emanating in France's Rouen, which is Europe's wheat export hub, will fall this year. Analysts project France's wheat shipments will plummet by more than 23 percent in the 12 months ending next June, underscoring how mounting competition is affecting the country's former stranglehold on the wheat market.

The reduction in shipments from France is especially surprising given data from the prior year. In 2010, inclement weather in Russia prompted Egypt and other countries to increase wheat purchases from France, driving them up by 16 percent. The contraction in world supplies was exacerbated as Russia and Ukraine stopped international shipments as officials in those countries worked to augment domestic stockpiles.

Wheat prices surged as a result, but they have fallen over the course of this year. After hitting record levels in February, wheat futures have dropped significantly, according to data from the Chicago Board of Trade. On Monday, wheat futures for March delivery declined by 1.2 percent, or 7.75 cents, to close at $6.38 per bushel.

Wheat futures have fallen 20 percent on the Chicago Board of Trade this year.
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