UPDATE 1-EU wheat scores new 1-year high on dry U.S. weather

(Updates prices)
PARIS, June 26 (Reuters) - European wheat futures continued
to climb on Tuesday, scoring a new one-year high, fuelled by a
rally in U.S. grains on concerns over further stress to crops
from heat and dryness in the U.S. Midwest.
* November milling wheat on the Paris futures market
gained 1.25 euro or 0.6 percent to 226.25 euros a tonne by 1558
GMT, after touching a new one-year high on the contract of
228.75 euros a tonne.
* U.S. corn futures were headed for their biggest two-day
rally in two years on Tuesday as unrelenting heat and dryness in
the U.S. Midwest threatened daily damage to what was initially
expected to be a record harvest.
* Euronext brokers noted that sellers on the futures market
were mainly growers trying to benefit from the surge in prices
while buyers tended to be financial players, which boosted the
rise in prices.
* "We are in a typical weather market. We are following
forecasts as often as we can," one trader said, noting that
these sometimes changed rapidly with forecasts now pointing to
dry and hot weather in the U.S. Plains against wetter conditions
that had been predicted recently.
* Activity continued strong on European milling wheat
futures with more than 38,000 lots exchanged by 1600 GMT. On
Monday it recorded its highest daily volume since it began
trading, with 48,198 lots.
* In London, November feed wheat was stable at
168.00 pounds.
* The London contract had risen as much as 10 percent from
last week's low of 153.75 pounds to reach 169.00 pounds on
Monday and again on Tuesday.
* New-crop corn futures in Chicago shot up by the daily
maximum 40 cents in the previous session, pulling wheat higher,
as hot, dry conditions expected this week threatened to add to
stress on Midwest crops.
* In addition to spillover support from corn, wheat has also
been supported by similar concerns over hot, dry weather in the
Black Sea region this spring.
* A sharp cut to the supply outlook of the Russian
government and leading analyst SovEcon fuelled Monday's market
surge, raising the prospect of less ample supply next season
from one of the world's top wheat exporters.
* But rain is expected in Russia's key southern agricultural
regions in the coming days, the state weather forecaster and an
analyst said on Tuesday, while some European traders said
Monday's forecasts of a wheat crop below 50 million tonnes were
too pessimistic at this stage.
* Traders said the focus would remain on the U.S. crop
outlook and that weather risks there were preventing a
significant pullback on grain markets.
* "We had huge volumes yesterday. There was a real drive
upwards on the back of U.S. weather. It wouldn't surprise me if
when the U.S. wakes up we start to creep back up again," a
London dealer said.
* Tunisia's state grains agency is tendering to buy five
cargoes of 25,000 tonnes each of soft wheat from optional
origins for shipment in August and September, traders said on
Tuesday.

Prices as of 1605 GMT
Product Last Change Pct Move End 2011 Ytd Pct
Paris wheat 226.00 1.00 +0.44 195.25 15.75
London wheat 168.00 0.00 +0.00 153.65 9.34
Paris maize 206.00 1.00 +0.49 197.25 4.44
Paris rape 483.75 1.50 +0.31 421.50 14.77
CBOT wheat 723.75 -0.50 -0.07 671.25 7.82
CBOT corn 607.50 16.25 +2.75 654.75 -7.22
CBOT soybeans 1464.00 -3.00 -0.20 1207.75 21.22
Crude oil 78.96 -0.25 -0.32 98.83 -20.11
Euro/dlr 1.25 -0.02 -1.68 1.30 -3.59
* Paris futures prices in Euros per tonne, London wheat in
pounds per tonne and CBOT in cents per bushel.

(Reporting by Valerie Parent and Gus Trompiz in Paris and Nigel
Hunt in London; Editing by Anthony Barker)