Euronext wheat fell on Monday in step with Chicago as rain in the US Plains and the Black Sea region tempered concerns about harvest risks, despite signs of persisting dryness in Europe.
September milling wheat on Paris-based Euronext settled down 2.00 euros, or 1.1%, at 184.50 euros ($201.25) a tonne.
Chicago wheat slipped to a two-month low as tepid export demand and beneficial rain in US and European wheat belts supported expectations for a large global surplus in the coming season.
A sharp rise in the euro against a broadly weaker dollar also curbed Euronext prices as it made euro-denominated grain more expensive overseas.
Euronext was holding in its recent price range and volumes remained moderate as the market weighed harvest prospects.
"As we enter the traditional mid-May to mid-July weather market, anything could still happen," consultancy Agritel said in a note. "The rains have stabilised yield potential but not improved it," it added, regarding European wheat.
The European Union's crop-monitoring service MARS on Monday cut its forecast of the EU soft wheat yield this year due to dry, warm conditions in the past month.
In Romania, wheat output is expected to fall sharply this year due to prolonged drought, farmers and experts said on Monday.
In exports, weekly EU data showed the bloc plus Britain had exported 30.26 million tonnes of soft wheat so far in 2019/20, up 64% from a year earlier.
In Germany, traders were also assessing weather updates.
"Regular rain is needed into June in east Germany but wheat in western and southern areas of the country is now expected to be in pretty good shape after we had lots of rain in the past couple of weeks," one German trader said.
"The latest harvest forecasts are reasonable and certainly not a disaster."
The country's association of farm cooperatives on Friday reduced its forecast for this year's all-wheat crop to 22.38 million tonnes from 22.73 million estimated last month, partly due to dry weather.
On the demand side, the easing of lockdown measures to counter the novel coronavirus and a steady pace of exports were underpinning the German market.
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