PARIS: Euronext wheat fell on Thursday as Chicago futures retreated from a surge the day before, with traders seeking confirmation of rumoured sales of US wheat to China and a clearer picture of an uneven harvest in Europe. September milling wheat on the Paris-based Euronext exchange settled 1.50 euros, or 0.8%, lower at 185.75 euros ($212.07) a tonne.

Chicago wheat slid 2% in US trading to give back some of its steep gains from Wednesday when prices soared to their highest in nearly three months. Talk of a purchase of US wheat by China fuelled Wednesday's rally but traders said the rise appeared speculative.

"Today the market is correcting a little after it didn't quite reach chart levels to give it fresh impetus," a futures dealer said. "Production prospects for maize in Europe and the US also look favourable so that can also be a curb on wheat."

Euronext, which had rallied to a seven-week high of 189.75 euros last Friday, remained underpinned by uncertain harvest prospects in Europe and the Black Sea region. Consultancy Strategie Grains further reduced its monthly forecast for the soft wheat harvest in the European Union, to 130.3 million tonnes from 130.9 million in June, or 11.5% below last year's harvest.

In France, yields were improving as harvesting moved northwards but would not necessarily compensate for some very poor results further south, traders said. In Germany, traders were closely watching forecasts of drier weather from Friday that could help crops ripen before an expected start to harvesting in late July and early August.

"Everyone is waiting for sunshine and the forecasts are starting to look better," one German trader said. Two forecasts of a slightly smaller German wheat crop on Wednesday from the country's farming cooperatives and French consultancy Agritel were seen as within expectations, underlining expectations of a reasonable crop.