Euronext wheat higher as Chicago rally offsets stronger euro

PARIS, June 4 (Reuters) - European wheat futures edged up on Wednesday with support from a rally in Chicago, though the euro's strength limited gains in Paris and kept prices near contract lows.

September milling wheat BL2U5, the most active position on Paris-based Euronext, settled up 0.5% at 203.00 euros a metric ton after trading just above last Thursday's contract low of 200.25 euros.

Chicago wheat Wv1 climbed around 2% in U.S. trading, supported by a drop in the dollar =USD along with concern over heavy rain in some U.S. wheat zones. GRA/

A corresponding rise in the euro EUR= weighed on Euronext, reinforcing negative export sentiment amid a lull in international demand. GRA/TEND

But the U.S. wheat rally and investors' reluctance to add to short positions helped Euronext continue holding above the 200 euro floor.

"The euro was strong again with the disappointing U.S. macro data," a futures dealer said. "But funds are already extremely short so they don't necessarily want to sell."

Financial investors extended their net short position in Euronext wheat last week, data published by the exchange on Wednesday showed.

War headlines this week, as Ukraine has stepped up attacks on Russian targets, have rekindled concerns about Black Sea grain trade.

But slow export demand and expectations of ample global supply in the upcoming season hung over the market.

In France, a light wheat loading programme at ports continued to be reliant on shipments to Morocco and European neighbours like Spain, LSEG data showed. GRAIN/SHP/FR

Showers reached some dry northern French regions on Wednesday, with more rain forecast during the rest of the week, tempering worries about crop stress following a very dry spring.