EU wheat prices ease with Chicago as China-fuelled rally subsides

PARIS, Nov 19 (Reuters) - Euronext wheat prices fell on Wednesday in step with Chicago as a grain market rally spurred by Chinese purchases of U.S. soybeans faded and wheat traders turned their attention back to ample global supply.

March wheat BL2H6, the most-active contract on the Paris-based Euronext market, was down 1.4% at 193.25 euros ($222.95) by 1703 GMT, after reaching its highest in nearly two weeks at 196.50 euros.

December wheat BL2Z5, less active following the expiry of options against the front-month position, was 0.5% lower at 189.75 euros after reaching a one-week top at 192.00 euros.

Chicago wheat Wv1 slipped more than 1% in U.S. trading, retreating from a 4-1/2 month peak struck on Tuesday. GRA/

Wheat had drawn support from a rise in Chicago soybeans Sv1 to a 17-month high this week as China stepped up purchases of U.S. beans following a trade truce between Beijing and Washington.

"The move up in wheat was overdone," a futures trader said. "There is plenty of wheat still there - if it's not Black Sea supply, it's Argentina, Australia and so on."

Underscoring ample availability of wheat, Ukraine's deputy economy minister told Reuters on Wednesday that the country would not restrict wheat exports in 2025/26 due to a higher harvest and slower shipments at the start of the season.

In Germany, traders reported low wheat selling by farmers who are more interested in providing more attractively-priced rapeseed and barley.

“It is difficult to get enough volumes of wheat together for export sales, while low prices offered for new-crop Argentine wheat are also providing hard competition especially in African markets,” one German trader said. “Black Sea prices are very close to EU levels but the Black Sea, especially Ukraine, is still getting purchase interest.”

Traders said a buyer in Sudan was seeking up to 70,000 tons of 11.5% protein Ukrainian wheat at around $260-$265 a ton cost and freight included (c&f) for January shipment, while a buyer in Libya was seeking around 30,000 tons of 12.5% protein Ukrainian wheat at $251-$253 a ton c&f for December shipment.

Feed barley supply remained tight, with Jordan getting no offers in a tender seeking 120,000 tons of feed barley on Wednesday. GRA/TEND

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

($1 = 0.8668 euros)