U.S. grains: Soybeans dip on Argentina rain outlook, technical selling

Chicago | Reuters — U.S. soybean futures fell for a third straight session on Friday on technical selling and as an improved South American crop weather forecast soothed some anxiety about drought-reduced production in Argentina.

Wheat also declined, with soft red winter wheat futures pressured by forecasts for snow in some U.S. production areas.

Corn was little changed as pressure from an improved Argentine weather forecast was offset by rising U.S. export demand.

The market’s focus is shifting to next week’s monthly U.S. Department of Agriculture supply and demand reports, when the agency is expected to adjust its South American crop estimates following a stretch of adverse weather.

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Forecasts for wetter, cooler weather eased jitters about Argentine drought damage, while a drier outlook in Brazil could help harvesting of what is expected to be another bumper crop.

Several private forecasters this week cut their forecasts for Argentine crops but expanded Brazilian harvest views.

“If we lose two or three million metric tonnes in bean supply in Argentina, it could be offset by an equivalent amount in Brazil,” said Mike Zuzolo, president of Global Commodity Analytics.

The soybean market is also facing pressure from tepid demand for U.S. cargoes as sales fell to a seven-month low last week.

Chicago Board of Trade March soybeans were down 6-1/4 cents at $9.78-3/4 a bushel, ending the week down 0.7 per cent for its first weekly drop in three weeks (all figures US$). The contract failed to breach chart resistance at its 100-day moving average, and selling accelerated as prices fell below its 50- and 200-day moving averages.

CBOT March corn was 1/4 cent lower at $3.61-1/2 a bushel but notched a 1.4 per cent weekly increase, its third straight.

USDA reported another 365,000 tonnes of U.S. corn export sales on Friday, its seventh daily corn sales announcement in nine days.

CBOT March soft red winter wheat shed 4-1/4 cents to $4.46-3/4 a bushel but ended the week up 1.3 per cent, rising for a third straight week.

K.C. March hard red winter wheat was down 3-3/4 cents at $4.63-1/4 a bushel. The contract was up 4.6 per cent in the week, its third straight weekly gain and the strongest weekly advance in seven months.

Forecasts for snow in the eastern U.S. Midwest weighed on the market as the protective snow cover and increased moisture was seen boosting the SRW crop. Dry conditions in the U.S. Plains offered underlying support to the HRW market.

— Karl Plume reports on agriculture and agribusiness for Reuters from Chicago; additional reporting for Reuters by Naveen Thukral in Singapore and Gus Trompiz in Paris.

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