* Euro slide may boost end of export campaign, ease stocks
* Algeria tender, Mexico shipment raise French export hopes
* German trade wants lower euro, Spain sees dollar headache
* Russian exports, price correction may limit EU shipments
By Gus Trompiz
PARIS, May 7 (Reuters) - A tumbling euro could give European wheat exports an extra lift in the final weeks of the 2009/10 campaign, enabling the region to clinch deals in both traditional markets and rarer destinations like Latin America.
The windfall may be limited by competition from Russia and slower demand from North African buyers as local harvests get underway, but should still put a better gloss on a season marked by brimming stocks, analysts and traders said.
Weakness in the euro, which touched 14-month lows against the dollar this week on fears Greece's debt crisis will spread, makes shipments from euro-zone exporters like France and Germany cheaper in international grain markets that trade in dollar prices.
"We have the euro-dollar rate that has slipped and the fact the U.S. market is holding up. This makes us a lot more competitive," one French trader said.
French wheat was seen as best placed to enjoy an export run and sentiment has been boosted by confirmation of a rare shipment to Mexico and expectations of new business in a tender from Algeria.
A fall in the euro in March, coupled with a drop in benchmark European prices, sparked an upturn in exports and led to reports EU origins had won rare sales to Latin America.
A subsequent market rally eroded this competitive edge, putting in doubt Latin American sales booked as optional-origin, but the new slide in the euro could reinvigorate French sales.
"Has this window of opportunity (to Latin America) reopened? It's possible," said Emmanuel Jayet, analyst with Societe Generale.
Many in France expect the country's wheat exports outside Europe this season to top the 9.2 million tonnes currently forecast by farm office FranceAgriMer.
"The increase in competitiveness could allow us to exceed this figure a bit," said Cedric Weber, analyst with grains consultancy Offre & Demande Agricole. ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
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STOCKS STILL SUBSTANTIAL
But for this spate of deals to snowball into an export surge, the euro would have to keep falling and European prices remain relatively attractive against rival origins.
"Most people seem to think a further drop in the euro to around $1.20 is needed to create big new export business," a German trader said.
The euro fell below $1.27 on Thursday to a low since March 2009. It recouped some losses on Friday but remained fragile as long as markets feared Greece's debt problems could spread, operators said.
Operators in Germany, the European Union's No. 2 grain exporter, also stressed they were waiting for evidence of new business to ease persistent pressure from large old-crop stocks. European wheat also continued to face tough competition from Russia, which had benefitted from a drop in the rouble against the dollar, Societe Generale's Jayet added.
"There is a general wave of risk aversion, this is not just affecting the euro against dollar."
In major importer Spain, meanwhile, a rising dollar risked pushing up short-term costs for a grains sector that depends partly on dollar-priced imports from outside the EU.
"The dollar at 1.27 is giving us a big headache," one dealer said.
The Spanish market, which has a structural shortfall in wheat of least 7 million tonnes a year, was holding out for a correction in world dollar-denominated commodity prices that typically follows a rally in the U.S. currency, operators said. (Additional reporting by Valerie Parent in Paris, Michael Hogan in London and Martin Roberts in Madrid; editing by Marie Maitre and Sue Thomas)