EU wheat eases as euro rise outweighs Chicago gains

PARIS, Jan 6 (Reuters) - Euronext wheat fell further from a recent six-month high on Monday, as a jump in the euro against the dollar outweighed a rally in Chicago grains.

Benchmark March milling wheat BL2H5 on Paris-based Euronext settled 0.8% lower at 231.25 euros ($240.04) per metric ton.

It earlier fell to 230.50 euros, its lowest in more than a week, to extend a pullback from Thursday's peak of 239.50 euros that had marked a front-month high BL2c1 since mid-June.

The euro EUR= accelerated a rebound from last week's two-year low against the dollar after the Washington Post reported that U.S. tariffs might be more selective than President-elect Donald Trump has previously threatened. Trump later denied the report. MKTS/GLOB

A stronger euro makes Euronext grain dearer overseas.

Some saw the year-end rally on Euronext as overdone and the euro-fuelled retreat necessary to keep European wheat competitive.

"Matif (Euronext) got too expensive against U.S. wheat, while Russian prices haven't risen as much as expected," a futures dealer said. "It was really a rush of short-covering last week."

The weaker dollar helped Chicago wheat, corn and soybeans rebound from losses on Friday, limiting the fall on Euronext. GRA/

The U.S. market was also underpinned by concerns over hot, dry weather that could stress corn and soybean crops in Argentina and southern Brazil.

Volumes on Euronext remained moderate as many market participants were catching up after the New Year holiday, according to traders.

Grain markets are also looking ahead to the world crop outlook from the U.S. Department of Agriculture on Friday.

($1 = 0.9634 euros)

(Reporting by Gus Trompiz; Editing by Alexander Smith)

((gus.trompiz@thomsonreuters.com))