EU wheat extends slide as euro and harvest weigh

PARIS, June 26 (Reuters) - European wheat futures fell further on Thursday to reach new contract lows as more gains for the euro hurt export sentiment, while expectations of large Northern Hemisphere crops offset concerns about hot weather in France.

September wheat BL2U5 on Euronext was down 0.9% at 195.50 ($228.68) per metric ton by 1516 GMT, falling for a fifth straight session.

The price benchmark earlier dropped to 194.50 euros, below a previous contract low of 196.50 euros from Wednesday.

Chicago wheat Wv1 fell for a fourth day. GRA/

After the short war between Israel and Iran triggered short-covering in wheat last week, de-escalation this week has put attention back on favourable supply prospects in Northern Hemisphere harvests getting under way.

The euro EUR= rose to another 3-1/2 year high against the dollar, deepening export gloom in western Europe for the new season that starts in July.

"The euro's rally against the dollar exacerbated the (price) decline, while France's hot, dry weather hasn't added enough risk premium to offset bearish trends," British merchant ADM Agriculture said in a note.

The International Grains Council on Thursday raised its forecast for global wheat production in 2025/26, partly due to a 1 million ton upward revision for Romania's crop.

The improved outlook in Romania also led the IGC to raise its forecast for the European Union wheat crop, outweighing a smaller downward revision for France.

A hot spell in France since mid-June has exacerbated dry conditions, though traders say most wheat crops should escape severe damage since they have already passed through critical yield-determining stages.

In central France, cooperative Limagrain said high temperatures were trimming what had been very strong potential.

"Wheat crops are starting to struggle, with signs of scalding," Sebastien Chauffaut, CEO of Limagrain, told reporters. "The hot spell is not disastrous because we have had plenty of moisture but it's beginning to hurt."

In exports, port data showed the second of three expected cargoes of French wheat for Egypt was due to load at the northern port of Rouen later this week.

A cargo of French barley for China was also due to load at Rouen next week, following a similar shipment this week at La Pallice on the west coast.

($1 = 0.8549 euros)