PARIS, June 12 (Reuters) - Euronext wheat closed slightly lower on Wednesday as the market balanced the strength in U.S. prices amid Midwest weather concerns against a broadly favourable harvest outlook in Europe.
Benchmark September milling wheat on the Paris-based Euronext exchange settled 0.50 euro, or 0.3%, lower at 177.25 euros ($200.17) a tonne.
Front-month prices remained above Tuesday’s two-week low of 175.75 euros.
Chicago grain futures had rallied on Tuesday after the U.S. government reduced by more than expected its outlook for this year’s U.S. corn harvest after a rain-disrupted planting season.
The rally resumed in Wednesday’s U.S. trading as weather forecasts pointed to more heavy rain in U.S. grain belts in the week ahead.
In contrast, rain in major EU producing countries like France and Germany was seen as beneficial for crops after dry conditions that have persisted since a drought last year.
“Wheat in south and west Germany is now looking good up to the harvest but more rain is still needed in north and eastern areas if forecasts of a larger German crop this year are to be achieved,” one German trader said.
Standard bread wheat with 12% protein for September onwards delivery in Hamburg was offered for sale unchanged at 2 euros under Paris December. Buyers were seeking at least 4 euros under.
In Poland, prices were mixed in the past week.
“Polish industrial buyers, both feed makers and flour mills, seem to have good supply cover for June and are not willing to pay more than needed,” one Polish trader said.
“They are waiting for the new crop, which looks very good and cheap now.”
Prices for 12.5% milling wheat for June delivery fell by 20 zloty on the week to between 740-760 zloty (173.6-178.3 euros) a tonne.
Exporter prices for old crop 12.5% wheat rose by 20 zloty to 760 zloty a tonne delivered port for June. New crop 12.5% pro wheat was also quoted 760 a tonne for delivery to the port from this summer’s harvest.
Two shipments of Polish wheat to Algeria were reported in the past week, one from Szczecin with 30,000 tonnes of milling wheat for Algiers and another with 25,000 tonnes for Oran.
In France, farm office FranceAgriMer kept unchanged at 9.75 million tonnes its monthly forecast of soft wheat exports outside the EU in the 2018/19 season that ends on June 30.
However, port data suggests France may fall short of that objective, with 9.35 million tonnes of soft wheat shipped or loading for non-EU destinations by June 12.
Weekly Euronext data showed financial investors cut their net long position in the exchange’s wheat futures and options in the week to June 7.
$1 = 0.8855 euros Reporting by Valerie Parent in Paris and Michael Hogan in Hamburg, writing by Gus Trompiz. Editing by Jane Merriman