GRAINS-Corn off 3-month low, but faces biggest monthly fall in a yr

By Colin Packham
SYDNEY, Sept 28 (Reuters) - U.S. corn came off a three-month
low on Friday after coming under pressure from technical selling
and fund liquidation in the prior session, with investors
awaiting a closely watched U.S. Agriculture Department quarterly
report on grain stocks.
Corn is on course to finish the month down more than 10
percent, its biggest monthly fall for a year, as disappointing
export sales also weigh.
Soybeans rose, but remained closed to seven week lows, while
wheat was little changed after hitting a 2-1/2-month low on
Thursday.
Despite firming slightly, wheat is course to record its
biggest weekly fall in nearly four months, and the largest
monthly fall in ten months.

FUNDAMENTALS
* December corn rose slightly to $7.17 a bushel,
having dropped 1.17 percent in the previous session to the
lowest for a front-month contract since July 3. Corn is down 4.2
percent for the week following a similar fall the week before.
* Chicago Board Of Trade November soybeans rose 0.33
percent to $15.76 a bushel, having slipped 0.14 percent on
Thursday. Soybeans are down 2.85 percent for the week, the
second consecutive fall following on from a decline of 6.47
percent, the biggest weekly fall in a year.
* December wheat was flat at $8.55-1/4-3/4 a bushel,
having closed down 1.58 percent on Thursday. Wheat is on course
to finish the week down 4.49 percent, the biggest fall since
early June, while the grain is down 3.8 percent for September.
* USDA report could show season-end stocks of corn and beans
at an eight-year low.
* Funds liquidate positions in preparation of the USDA
report. Commodity funds sold an estimated net 9,000 corn
contracts and 4,000 wheat contracts on the day, trade sources
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.
* The Reuters poll showed U.S. wheat stocks on Sept. 1 at
2.278 billion bushels, up from 2.147 billion a year ago, and
soybean stocks at 131 million, down from 215 million a year ago.
* U.S. Sept. 1 soybean stocks should fall to 131 million
bushels, according to the average analyst estimate, the lowest
level since 112 million in 2003/04. The figure was nearly
unchanged from the 130 million bushels that USDA forecast
earlier this month for 2011/12 soy ending stocks.
* Estimates for corn ending stocks ranged from 887 million
to 1.261 billion bushels.
* 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.

* Wheat under pressure from beneficial rains in the southern
U.S. Plains winter wheat.

MARKET NEWS
* The euro held firm on Friday, while commodity currencies
started Asian trade sharply higher as worries about the euro
zone eased somewhat after Spain unveiled a crisis budget that
many saw was a step towards a bailout.
* Oil prices rose on Thursday as tensions between Iran and
the West reinforced concerns about potential supply disruptions,
while Spain's plans for economic reform also lent support to
crude and lifted equities on Wall Street.
* The S&P 500 snapped a five-day string of declines in a
broad-based rally on Thursday, as Spain's plans for economic
reform eased some worries about one of the euro zone's most
troubled countries.

DATA/EVENTS (GMT)
0230 China HSBC Manufacturing PMI Final
0500 Japan Construction orders
0600 Germany Retail sales
0900 Euro zone Inflation
1230 U.S. Quarterly grain stocks report
1230 U.S. Personal income/spending for August
1345 U.S. Chicago PMI for September
1355 U.S. Thomson Reuters/Univ of Michigan final
consumer sentiment index for September
1930 U.S. CFTC commitment of traders data

Grains prices at 0043 GMT
Contract Last Change Pct chg Two-day chg MA 30 RSI
CBOT wheat 855.25 -0.25 -0.03% -1.61% 889.19 37
CBOT corn 717.00 0.75 +0.10% -1.07% 780.37 22
CBOT soy 1576.00 5.25 +0.33% +0.19% 1692.06 26
CBOT rice $15.19 $0.02 +0.16% +1.27% $15.26 56
WTI crude $92.25 $0.40 +0.44% +2.52% $95.11 42
Currencies
Euro/dlr $1.291 -$0.001 -0.05% +0.28%
USD/AUD 1.044 0.000 -0.01% +0.68%
Most active contracts
Wheat, corn and soy US cents/bushel. Rice: USD per hundredweight
RSI 14, exponential

(Editing by Ed davies)