December 4, 2017 / 4:29 AM / 4 months ago

GRAINS-Corn hits 3-month high on LatAm crop concerns, short-covering

    * Corn climbs to highest since Sept 7, rises for 5th session
    * Short-covering, dryness in Argentina driving prices higher
    * Soybeans hit over three-week high, wheat gains more ground

 (Adds details, quotes)
    By Naveen Thukral
    SINGAPORE, Dec 4 (Reuters) - Chicago corn climbed to its
highest since early September on Monday with concerns that dry
weather will hurt crop yields in Argentina underpinning the
    Soybeans rose for a second session to highest in more than
three weeks while wheat ticked higher, rising for four out of
five sessions.
    The Chicago Board of Trade most-active corn contract
gained 0.3 percent to $3.59-3/4 a bushel by 0351 GMT. Earlier in
the session, the market jumped to $3.60 a bushel, the highest
since Sept. 7.
    Soybeans rose 1 percent to $10.04-1/2 a bushel, the
highest since Nov. 9 and wheat added 0.8 percent to $4.42
a bushel. The wheat market at intraday high of $4.42-1/2 a
bushel was the highest since Nov. 22. 
    "Supply worries have entered the frame, both Argentina and
Brazilian summer crop areas are facing significant weather
stress," said Tobin Gorey, director of agricultural strategy at
Commonwealth Bank of Australia.
    "These factors for now should help partially offset the slow
start to U.S. exports."
    Dry weather across Argentina's farms is supporting corn and
soybean prices. 
    Parts of Argentina's soybean and corn belt received some
beneficial rains last week, but dry weather remains a concern
across several provinces.
    Brazil's corn production will drop by almost 17 percent in
the 2017/18 crop cycle, consultancy Safras & Mercado said on
Friday, reflecting a reduction in estimated planted area and
lower prices for the grain.
    Corn output will total 90.52 million tonnes, compared with a
Safras estimate of 108.87 million tonnes for production in the
2016/17 crop season, the consultancy said.
    Gains in corn and soybeans are likely to be capped by
expectations of increase in U.S. production next year.
    U.S. farmers are likely to expand plantings of both corn and
soybeans while reducing wheat seedings for the upcoming
marketing year, the U.S. Agriculture Department said last week.

    Large speculators trimmed their net short position in
Chicago Board of Trade corn futures in the week to Nov. 28,
regulatory data released on Friday showed. 
    The Commodity Futures Trading Commission's weekly
commitments of traders report also showed that non-commercial
traders, a category that includes hedge funds, increased their
net short position in CBOT wheat and switched to a net long
position in soybeans.
    Concerns over storms damaging Australian wheat crop eased
after less than expected rains over the country's south-eastern
    "The market's fears about several days of heavy rainfall in
south eastern crop regions were clearly subsiding on Friday,"
Gorey said.
    "And these regions seem to have received a lot less rain
than was feared on Wednesday and Thursday last week."
 Grains prices at  0351 GMT
 Contract    Last     Change  Pct chg               MA 30    RSI
 CBOT wheat  442.00   3.50    +0.80%                442.00   46
 CBOT corn   359.75   1.00    +0.28%                359.75   59
 CBOT soy    1004.50  10.25   +1.03%                1004.50  69
 CBOT rice   12.44    -$0.03  -0.20%                $12.44   68
 WTI crude   57.93    -$0.43  -0.74%                $57.93   59
 Euro/dlr    $1.187   $1.187                                 
 USD/AUD     0.7603   0.760                                  
 Most active contracts
 Wheat, corn and soy US cents/bushel. Rice: USD per
 RSI 14, exponential

 (Reporting by Naveen Thukral; editing by Richard Pullin and
Amrutha Gayathri)
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