PARIS: European wheat futures fell on Wednesday, tracking a slide in Chicago after a US government report projected higher supplies than the market had expected.
December milling wheat, the most active contract on the Paris-based Euronext exchange, settled down 2.25 euros, or 1.2 percent, at 184.75 euros ($210.97) a tonne.
The drop took it further from last week's 18-month high of 189 euros, although prices were underpinned by prospects of more crop damage in the United States and uncertainty over weather effects on the European harvest.
Chicago wheat fell after a July report by the US Department of Agriculture (USDA) cut the estimate for this year's US wheat crop by less than anticipated and unexpectedly raised projected US wheat stocks.
Experts had expected a bigger reduction in US production estimates after hot, dry weather in the northern United States.
"It wasn't a good report for wheat prices, with the sharp increase in US stocks," a futures dealer said.
"There is always that risk when you have very strong market expectations while USDA can be more conservative, plus its report won't have factored in the last few days of drought."
The USDA report showed higher-than-expected global wheat supplies, including a 3 million tonne increase to forecast Russian wheat output, although world wheat stocks were revised down marginally.
In France, traders continued to assess prospects for the harvest, which has been interrupted by rain since last weekend.
Market estimates for the soft wheat crop were converging in a 36-37 million tonne range, similar to a farm ministry estimate, while quality concerns were moderate for now, said Remi Haquin, grain committee chair at farm office FranceAgriMer.
In updated supply and demand data for the 2016/17 season that ended on June 30, FranceAgriMer raised slightly its estimate of French soft wheat stocks to 2.8 million tonnes.
In Germany, cash premiums in Hamburg were little changed as dealers monitored rain in Germany as wheat harvesting was about to start.
"It is still hard to say what the impact of rain will be," one German trader said.
"It is a surprising picture with empty old crop storehouses in the north and new crop difficult to trade. We are now waiting for harvesters to start rolling in the north and eastern export regions," the trader said.
Standard bread wheat with 12 percent protein content was offered for sale at an unchanged 4 euros under the Paris December contract for September delivery in Hamburg.
Premiums for high protein wheat in Hamburg remained way over bread wheat.
High quality wheat with 14 percent protein content for September/December delivery in Hamburg was offered for sale at an unchanged premium of 22-23 euros over Paris December.
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