Euronext wheat slips to fresh lows as Russian competition looms

PARIS, Aug 28 (Reuters) - Euronext wheat futures dropped on Thursday to contract lows as a firmer euro and falling prices in Russia weighed on export sentiment.

December milling wheat BL2Z5 on Paris-based Euronext was down 0.9% at 1540 GMT to 192.25 euros ($225.07) per metric ton. It earlier set a new contract low of 191.75 euros that also marked the weakest second-month price BL2c2 since March 2024.

September wheat BL2U5, which expires on September 10, was down 1.8% at 189.00 euros a ton. The front-month position earlier hit a contract low of 188.00 euros, with the closing of positions pushing it through chart support.

After a slow start to Russia's export season helped boost demand for French wheat, weakening Russian prices as harvest supplies build up were cooling market sentiment.

"Harvest supply pressure is belatedly coming into play in the Black Sea region," Argus Media analyst Maxence Devillers said.

Argus now projects Russia's 2025 harvest at 86.1 million tons, in line with other forecasters who have pushed up estimates, Devillers said during a presentation.

Russian wheat export prices have fallen to their lowest in over a month, supported by a positive production outlook, LSEG analysts said.

In France, Argus forecast that soft wheat exports would rebound sharply this season but not enough to avert a rise in stocks to a 21-year high.

Limited availability in the Black Sea region has contributed to French sales to Egypt and Asian destinations including Thailand.

Port data compiled by LSEG showed six 30,000 cargoes of wheat were due to load for Morocco at the French ports of Rouen, confirming trader talk of a run of sales to the major importer. GRAIN/SHP/FR

Midweek showers in France have also boosted prospects for upcoming sowing for next year's wheat harvest, after summer drought and heatwaves disrupted drilling of rapeseed.

($1 = 0.8542 euros)