PARIS, Jan 10 (Reuters) - European milling wheat futures rose on Thursday as the market continued to rebound from a six-month low earlier this week, supported by rising prices in Chicago linked to U.S. export prospects and poor crop conditions.
* Gains in Europe were more modest, however, curbed by a rise in the euro against the dollar and by caution ahead of closely watched U.S. government data due on Friday.
* Paris benchmark March milling wheat was up 1.00 euro or 0.41 percent at 247.75 euros ($320) a tonne by 1252 GMT.
* Chicago wheat futures rose nearly 1 percent, bolstered by export demand and worries over the next U.S. harvest after the government declared a drought disaster in swathes of the wheat belt.
* Relatively cheap U.S. wheat has seen exports to China resume while it is also tipped by traders to claim a fresh sale to Egypt in a tender being held on Thursday by the world’s top wheat importer.
* “This is a U.S. wheat day,” one French trader said. “U.S. wheat is going to be the main winner in the Egyptian tender and the weekly U.S. export figures are also being watched.”
* This week’s U.S. grain export sales are due at 1330 GMT. The European Union is also due to publish this week export data for the period since the Christmas holiday, but the release has been delayed by technical problems, according to officials at the EU’s executive.
* The rise in the euro against the dollar, which makes European grains less competitive in world exports, kept a lid on Paris futures while giving extra support to Chicago prices..
* Traders were awaiting a clutch of U.S. Department of Agriculture (USDA) reports on Friday, spanning U.S. production, quarterly stocks, wheat seedings as well as global supply and demand.
* Expectations that the USDA will tighten U.S. corn supply helped push Chicago corn to one-week high.
* German wheat retained large premiums over Paris partly because of the good export outlook and high feed wheat prices, but in restrained dealing ahead of the key USDA world supply and demand report on Friday.
* Standard milling wheat for January delivery in Hamburg followed Paris up, offered for sale up 2 euros and well over Paris at 264 euros a tonne with buyers at around 262 euros.
* “The market is still in a risk-off mood with people not taking positions because of the USDA report on Friday,” one German trader said.
* “The overall export outlook remains positive with Black Sea supplies selling out and with strong demand likely to come from Britain in coming months after the poor British crop.”
* “But the overall value of the euro is still too high and this is dimming the export outlook.”
* Repeated demand and tight supplies again kept German feed wheat around the same level or even above milling prices.
* Feed wheat for January-March delivery in the South Oldenburg market near the Netherlands was offered for sale unchanged but above milling wheat at 266 euros a tonne with buyers at 264 euros.
$1 = 0.7667 euros Reporting by Valerie Parent in Paris and Michael Hogan in Hamburg; Editing by Alison Birrane