LONDON: European wheat prices fell on Wednesday as a short covering rally in Chicago fuelled by deteriorating US crop conditions ran out of steam.

March milling wheat on Paris-based Euronext closed 2.50 euros, or 1.6 percent, lower at 158.25 euros a tonne, retreating from Tuesday’s 2-1/2 week high of 161.00 euros.

Dealers said the pullback could accelerate if spot futures filled a chart gap down to 157.50 euros.

The rally on Euronext had surprised participants, with the threat to US crops set against high global supply and favourable crop conditions in Europe.

“Matif (Paris futures) followed CBOT in the rally these last two days without any clear reason,” one futures dealer said. “I think people are taking a quick profit now.”

CBOT wheat futures turned lower on Wednesday after earlier climbing to a four-month peak. The market had risen for five consecutive sessions.

In France, flooding following heavy rainfall in the past month led Rouen port - the country’s main grain export terminal - to close for shipping on Wednesday.

However, traders said the impact would be limited given that the wet weather had already slowed loading activity at Rouen.

Euronext, meanwhile, said it would decide in February when to begin publishing data on investors’ positions in its commodity derivatives, later than previously indicated by the financial market operator.

In Germany, cash market premiums in Hamburg were slightly stronger to compensate for the fall in Paris.

Standard bread wheat with 12 percent protein content for February delivery in Hamburg was offered for sale at 4.5 euros over Paris March against 4 euros over on Tuesday.

“Some hope is developing that we could see some new export business despite the firm trend in the euro,” one German trader said. “Saudi Arabia, a big buyer of German and Baltic region wheat, is expected to issue a new international tender to buy wheat soon.”

German inland markets, especially for feed wheat, remained above prices in ports.

Feed wheat prices in Germany’s South Oldenburg market were again above milling wheat, with February onwards delivery offered for sale up 0.5 euro at 169.5 euros a tonne with buyers seeking 168.5 euros.—Reuters