October 10, 2019 / 3:44 PM / 8 months ago

EU wheat eases after rally as USDA data awaited

PARIS, Oct 10 (Reuters) - Euronext wheat futures edged lower on Thursday, consolidating below a two-month high struck a day earlier as traders waited for fresh direction from U.S. government crop forecasts.

Grain markets are bracing for the U.S. Department of Agriculture’s October crop forecasts for a clearer picture of yields for late-planted U.S. corn and soybeans.

The cautious mood has been reinforced by the start of high-level talks between the United States and China to resolve a trade dispute.

Benchmark December milling wheat on Paris-based Euronext was down 0.75 euros, or 0.4%, at 178.00 euros ($195.94) a tonne by 1526 GMT.

The contract had climbed on Wednesday to 179.00 euros, a level last reached on Aug. 2, before being curbed by technical resistance at that level.

Euronext has rallied in the past month on the back of improving export prospects, helped by a weaker euro and higher prices for Black Sea origins like Russian wheat.

“Matif (Euronext) recovered well and cash markets are firmer everywhere,” a futures dealer said.

“The market now waits for the U.S.-China talks, the corn harvest, rains in Argentina and so on.”

In a sign of improving export sentiment in France, farm office FranceAgriMer sharply increased its forecast of French soft wheat exports outside the European Union this season, to 11.7 million tonnes from the 11 million estimated last month.

After large northern hemisphere harvests, the focus is turning to upcoming wheat harvests in Argentina and Australia where crops have endured parched conditions.

$1 = 0.9084 euros Reporting by Gus Trompiz in Paris; Editing by Kirsten Donovan

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