GRAINS-Corn, wheat fall to multi-month lows, await USDA reports

* Corn, wheat breach chart support, triggering sell-stops
* Disappointing export sales add pressure to grains
* Solid export demand underpins soy after hitting 7-week low
* Grain markets await Friday's USDA stocks report

(Updates with closing prices, fund buying/selling totals)
By Karl Plume
CHICAGO, Sept 27 (Reuters) - U.S. corn futures fell to a
three-month low on Thursday and wheat slid to a 2-1/2 month low,
both sinking for a fourth straight day, pressured by technical
selling and fund liquidation ahead of a government grain stocks
report on Friday.
Soybeans eased, weighed down by spillover pressure from
sinking grains, although worries about tight global supplies and
signs of improving demand following the recent price plunge
limited the decline.
Trading volume was light as investors squared positions
ahead of Friday's U.S. Agriculture Department quarterly report
on U.S. grain stocks, which could show season-end stocks of corn
and beans at an eight-year low.
Traders who bet on further price gains liquidated long
positions on chances Friday's data shows stocks are healthier
than expected.
"We've seen some support levels breached (in corn and wheat)
and we ran into some sell-stops. Trading volume hasn't been all
that impressive so it doesn't take any really sizable orders to
keep the downward momentum going," said Shawn McCambridge,
analyst at Jefferies Bache.
Disappointing export sales data on Thursday, particularly
for corn, kept pressure on grains as historically high prices
have eroded demand.
The U.S. Department of Agriculture reported net corn export
sales last week of just 400 tonnes, the lowest weekly total
since a net-negative week of sales nine weeks ago.
A consortium of hog and poultry producers this week
confirmed that they were importing 750,000 tonnes of Brazilian
corn over the next six months, blaming high U.S. prices and
scarce supplies after the worst drought in half a century.

Domestic corn demand has also slumped.
"We saw a drop in the ethanol production this week and we've
seen the various livestock reports reflecting continued
liquidation in the livestock also. Even though the production
number is uncertain, there's a general feel that we continue to
ration demand at the current price level," McCambridge said.
Chicago Board of Trade December corn fell 8-1/2 cents,
or 1.2 percent, to $7.16-1/4 a bushel, the lowest for a
front-month contract since July 3. The spot contract earlier
breached support at the 100-day moving average on a continuous
chart at about $7.15 a bushel.
The benchmark CBOT December wheat contract fell 13-3/4
cents, or 1.6 percent, to $8.55-1/2 a bushel. The plunge
accelerated as sell-stops were triggered as the contract dipped
below a mid-August low of $8.57-1/4.
Beneficial rains in the southern U.S. Plains winter wheat
belt added pressure.
Commodity funds sold an estimated net 9,000 corn contracts
and 4,000 wheat contracts on the day, trade sources said.

SOYBEANS MIXED
Soybeans hovered near previous levels, underpinned by
worries about tight global supplies and signs of renewed demand
after prices fell to seven-week lows.
"We've seen some profit taking in soybeans, mostly the weak
longs that have been flushed out of the soybean complex, but the
bottom line is that soybeans have considerable fundamental
support," said Karl Setzer, commodity trading advisor at
MaxYield Coop in West Bend, Iowa.
"We're hearing better yields as the harvest moves north, but
it's not enough to make up for the losses or to compensate for
the global shortage we have," he said.
The USDA on Thursday said net export sales of U.S. soybeans
last week hit a six-week high of nearly 800,000 tonnes and also
reported an additional 110,000-tonne sale to China via its daily
reporting system.
CBOT November soybeans shed 2-1/4 cents, or 0.1
percent, to $15.70-3/4 a bushel after earlier sinking to a
seven-week low of $15.57-1/2.

Prices at 2:34 p.m. CDT (1934 GMT)
LAST NET PCT YTD
CHG CHG CHG
CBOT corn 716.25 -8.50 -1.2% 10.8%
CBOT soy 1570.75 -2.25 -0.1% 31.1%
CBOT meal 473.10 -2.00 -0.4% 52.9%
CBOT soyoil 52.11 0.46 0.9% 0.0%
CBOT wheat 855.50 -13.75 -1.6% 31.1%
CBOT rice 1516.50 16.50 1.1% 3.8%
EU wheat 257.75 -3.50 -1.3% 27.3%

US crude 92.27 2.29 2.6% -6.6%
Dow Jones 13,504 90 0.7% 10.5%
Gold 1777.79 26.20 1.5% 13.7%
Euro/dollar 1.2916 0.0045 0.3% -0.2%
Dollar Index 79.5430 -0.3420 -0.4% -0.8%
Baltic Freight 744 -8 -1.1% -57.2%

(Additional reporting by Colin Packham in Sydney and Gus
Trompiz in Paris; editing by Anthony Barker, Tim Dobbyn, Andrew
Hay; Phil Berlowitz)