PARIS: European wheat prices slipped on Tuesday in the wake of a weaker Chicago market but to a lesser extent and in light trade due to a lack of new fundamental news, traders said.
May milling wheat on Paris-based Euronext, was 0.7 percent lower by 1700 GMT at 174.50 euros a tonne.
Chicago Board of Trade Chicago wheat turned lower in a lull after worries about dry conditions in some US wheat belts pushed prices to a two-week high a day earlier.
EU farm union Copa-Cogeca estimated EU-28 cereal production nearly stable this year at 296.6 million tonnes, up 0.8 percent on 2016, but said producers remained cautious as the size of the final crop would depend on weather events.
The forecast was based on a 1.8 percent drop in the area sown, the union said in a statement.
France, the EU's largest grain producer, has experienced a very mild and dry winter with temperatures 0.2 degrees Celsius above normal and a water deficit close to 40 percent on average, putting it among the five driest winters since 1959, forecaster Meteo France said.
However, like other EU countries, France had significant rainfall in recent days seen as beneficial to crops.
"The rain is really welcome," a Euronext trader said.
Elsewhere, two Russian wheat cargoes and one Argentine cargo destined for Egypt were rejected at their ports of origin on quality concerns, traders said.
"A rejection by Egypt could mean tighter requirements for its future purchases at a time when quality wheat is scarce around the world," a trader said.
Operators were also awaiting the US Department of Agriculture's report on Thursday which is expected to show a rise in wheat crop forecasts for Argentina and Australia.
German cash market premiums in Hamburg were little changed, underpinned by hopes of new export sales but in a risk off mood ahead of crop forecasts from the USDA report.
Standard wheat with 12 percent protein content for March delivery in Hamburg was offered for sale at an unchanged premium of 3 euros over the Paris May contract, buyers were seeking 2.5 euros over.
"The recent weaker trend in the euro has raised expectations we could see some new export sales, with hopes Saudi Arabia and South Africa could again be customers after recent sales," one German trader said. "This is supporting in a market rather lacking other impetus."
One ship is loading about 45,000 tonnes of wheat in Hamburg this week for South Africa. Two ships each with about 50,000 tonnes are due to sail this week from Germany to Saudi Arabia, traders said.
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