EU wheat rises with Algeria tender, Black Sea tensions in focus

PARIS, Dec 2 (Reuters) - Euronext wheat rose on Tuesday to recover from contract lows as an Algerian tender raised the prospect of fresh demand, while renewed threats to Black Sea shipping in the Russia-Ukraine war also unsettled traders.

March wheat BL2H6, the most active contract on the Paris-based Euronext exchange, was up 1.2% at 190.75 euros ($221.14) a metric ton by 1703 GMT, moving away from Monday's contract low of 186.75 euros.

After being pressured by rising estimates of southern hemisphere crops, which are set to intensify export competition, Euronext found support in news that Algeria has issued a wheat import tender, with bidding on Wednesday.

Headlines also rekindled concerns over war risks to Black Sea grain supply.

A Russian-flagged tanker carrying sunflower oil reported a drone attack off the Turkish coast on Tuesday, while Russian President Vladimir Putin threatened to cut off Ukraine's sea access in response to Ukrainian attacks on tankers from Russia's so-called shadow fleet.

"Putin is barking, there's an Algerian tender and there's a technical squeeze on Euronext," a futures dealer said.

Front-month December wheat BL2Z5 was up 2.3% at 191.00 euros as participants exited positions before the contract's expiry next week.

Chicago wheat Wv1 added more than 1% after reversing an earlier fall. GRA/

Reaction to the tender announcement by Algeria, one of the world's biggest wheat importers, was tempered by the country's decision to skip January and seek a February shipment.

European prospects were also dampened by expectations that Algeria will continue to tacitly exclude French supplies due to diplomatic tensions with Paris, and the likelihood of strong Argentine competition.

"Competition to the west EU will be intensely hard with low-price supplies from Argentina's big crop expected to be offered while Black Sea exporters are also well placed to win sales," a German trader said.

Some traders expected price offers in Algeria's tender on Wednesday of around $250-$257 a ton cost and freight (c&f) included, with Argentine expected to be at the lower end.

Argentine 11.5% protein new-crop wheat is seen as the world's cheapest at $206-$209 a ton free on board (FOB) for January/February shipment.

Russian 11.5% wheat was around $224-$225 a ton FOB. French, Romanian and Ukrainian wheat were in a similar range over Russian at $227-$230 a ton FOB.

Weekly European Union data showed EU soft wheat exports this season were running 5% below the year-ago level, though figures for countries including France remained incomplete.

($1 = 0.8626 euros)