EU wheat stuck near contract lows

PARIS, June 12 (Reuters) - Euronext wheat edged down on Thursday to hold around contract lows as a jump in the euro further dented export prospects while increased estimates of the upcoming European Union harvest reinforced expectations of abundant Northern Hemisphere supply.

The market showed little reaction to a world crop report from the U.S. Department of Agriculture in which the USDA trimmed its U.S. and world wheat supply outlook for 2025/26.

September milling wheat BL2U5, the most-active position on Paris-based Euronext, settled 0.4% down at 198.75 euros a metric ton, after earlier equalling Wednesday's contract low of 198.00 euros.

December futures BL2Z5, also used as a new-crop benchmark by traders, ended 0.7% down at 208.75 euros a ton after setting a new contract low at 208.25 euros.

Reluctance to sell among farmers unhappy at low prices as well as investors, who hold a large short position on Euronext, helped underpin the market.

Chicago wheat Wv1 also fell, despite support from a broad slide in the dollar =USD. GRA/

Consultancy Strategie Grains and grain trade association Coceral both increased their forecasts for European Union wheat production in separate updates on Thursday, notably due to strong yield prospects in Spain and southeast Europe.

"With global crop conditions improving and bearish trends confirmed technically, short-term downside risks remain in play," British merchant ADM Agriculture said in a note.

The euro's EUR= rally to its highest since 2021 against the dollar added to pessimism about the short-term outlook for western European exports. FRX/

"The renewed euro strength is disappointing, with west EU wheat still more expensive than the Black Sea despite the fall in Euronext below the 200 euro level," a German trader said. "But at least low prices seem to be generating new export demand at last with a new tender from Tunisia."

Russian and Romanian 11.5% protein wheat for July shipment on Thursday were both around $223 to $226 a ton FOB, about $8-$10 cheaper than French depending on Euronext and currency moves, he said.

Slow French export sales outside the EU meant more French sales inside the bloc, traders said. Coaster-size shipments of French old-crop feed wheat were offered to Irish Republic importers at premiums about 14 euros over Euronext September, cost and freight included (c&f).

However, Strategie Grains and the USDA each raised their forecasts for EU wheat exports in 2025/26. WASDE13