EU wheat jumps on relief that Trump did not impose tariffs, low euro

PARIS, Jan 21 (Reuters) - European wheat rose more than 2% on Tuesday, as traders were relieved that Donald Trump refrained from imposing immediate tariffs on European imports at the start of his second presidency and helped by a weaker euro against the dollar.

Benchmark March milling wheat BL2c1 on Paris-based Euronext, closed 2.1% higher at 231.25 euros a metric ton after hitting a six-week low in the previous session.

"President Trump was overall restrained in his initial moves on sanctions on trade with the EU, so perhaps we will not see near-term disruption to EU agricultural markets from U.S. sanctions," a German trader said.

But Russian and other Black Sea prices are low, and the background export picture remains price-bearish for EU wheat, he said.

SovEcon grain consultancy kept its forecast unchanged for Russia's 2025 wheat production at 78.7 million metric tons, down from 82.4 million last year.

It noted that the current weather setup, combined with the extremely poor condition of crops at the start of winter, meant that any significant cold snap could result in substantial winter kill.

A 60,000-ton wheat purchase in a tender by Jordan on Tuesday was tipped to be supplied from the Black Sea, probably Romania.

"Market talk is that Chinese buyers have cancelled some import contracts for Australian wheat, the lack of Chinese demand in Europe this year is disappointing," another trader said.

"This would illustrate continued weak Chinese wheat demand while the Australian volumes would have to be sold elsewhere in competition to the EU."

"We are still waiting for new purchase tenders with demand staying low. The new Egyptian state buying agency seems to be at least initially concentrating on private deals instead of international tenders, with cheap Russian wheat seemingly getting the business."

(Reporting by Sybille de La Hamaide in Paris and Michael Hogan in Hamburg; Editing by Vijay Kishore)

((Sybille.deLaHamaide@thomsonreuters.com; +336 8774 4148;))