Euronext wheat steadies after slide

PARIS, June 27 (Reuters) - European wheat edged higher on Friday, supported by Chicago after hitting contract lows but with strength in the euro and a favourable harvest outlook hanging over the market.

September wheat BL2U5 on Euronext settled 0.4% up at 196.00 euros per metric ton, breaking a five-day run of falls. On Thursday, it struck a contract low at 194.50 euros.

Over the week, the September contract was down nearly 6%.

Chicago wheat Wv1 regained ground after falling in the past four sessions. GRA/

The run-up to U.S. Department of Agriculture acreage and stocks reports on Monday was also encouraging grain markets to consolidate. USDA/EST

"For now, it's a technical bounce after a week of steep losses," a futures dealer said. "There has also been a bit of demand from Morocco in the past few days."

Traders cited talk that Moroccan importers had purchased several cargoes of wheat this week, with French wheat expected to fill part of the volume.

However, overall demand remained relatively slow, while the euro's rally against the dollar has dented hopes for western European exports at the start of the 2025/26 season that begins in July.

The euro EUR= rose to another 3-1/2 year high against the dollar on Friday, with the U.S. currency pressured by expectations of higher interest rates than previously anticipated. FRX/

After the conflict 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.

On Thursday, the International Grains Council raised its 2025-26 world wheat crop outlook by 2 million tons to 808 million, while the European Commission increased its forecast for the European Union's soft wheat crop by 1.6 million tons to 128.2 million tons.

In France, soft wheat harvesting has begun, with 1% of the crop gathered by Monday, while crop conditions stabilised following several weeks of decline, farm office FranceAgriMer reported on Friday.

A hot spell in France since mid-June has raised concern of crop stress, though traders say most wheat crops should escape severe damage since they have already passed through critical yield-determining stages.

Reports of good yields in the fast-moving winter barley harvest in France were also encouraging expectations of reasonable wheat yields.

Sweltering temperatures are again forecast across France this weekend and early next week, with concern shifting to later-developing maize that will enter pollination next month.