Wheat prices in western Europe were slightly lower on Monday, weighed partly by a firmer euro, but remained within striking distance of last week's 11-month peak as dealers kept a close watch on the crop outlooks in Russia and the United States. November milling wheat in Paris fell 0.50 euros or 0.25 percent to 216.00 euros a tonne by 1630 GMT.
The contract peaked at 218.75 euros a week ago, its highest level since June 2011. The euro recovered from two-year lows on Monday as Greek opinion polls showed more support for parties that favour sticking with the country's international bailout deal, leading investors to cut some of the record bearish bets against the shared currency.
Dealers said weekend rains in the Black Sea region may have improved the outlook for crops in some areas while other regions remain dry. Rain in the Russian south lessened the pressure on wheat prices last week but new concerns have arisen over the crop in Siberia and the Urals, where precipitation has been scarce, analysts said on Monday. "Russia crop concerns continue to circle with some reports saying Russia could lose up to 15 percent of its wheat crop if conditions remain dry," UK merchant Frontier Agriculture said in a market note.
Dealers noted concern that hot, dry weather in the US Midwest and Plains could damage crops. "The US wheat harvest is underway, earlier than usual, with yields seen as variable. Markets will be watching the progress in light of recent dry weather concerns," Britain's Home-Grown Cereals Authority said in a market note.
Large speculators slashed their net short position in CBOT wheat by 58 percent to its smallest in 8-1/2 months as worries about dry weather reducing the size of this year's winter wheat harvests forced them to unwind their bearish bet, regulatory data released on Friday showed.