August 13, 2019 / 4:54 AM / 4 months ago

GRAINS-Corn prices near 3-mth low on U.S. crop outlook, soybeans firm

    * Chicago corn futures down 2% to weakest since mid-May
    * Higher U.S. crop forecast drags down market
    * Soybeans rise 1.1% as USDA cuts production forecast

 (Adds comment, detail)
    By Naveen Thukral
    SINGAPORE, Aug 13 (Reuters) - Chicago corn futures lost more
ground on Tuesday, dropping to their lowest in nearly three
months after a U.S. government forecast for higher-than-expected
crop volumes.
    Soybeans rose more than 1%, underpinned by expectations of
lower production, while wheat was little changed after Monday's
biggest one-day loss since April 2016.
    The most-active corn contract on the Chicago Board of Trade
 had given up 1.7% to $3.86 a bushel by 0402 GMT, after
dropping to its lowest since May 17 at $3.82-1/4 a bushel.
Soybeans added 1% to $8.88-1/4 a bushel, while wheat
gained 0.1% to $4.72 a bushel.
    "The market was shocked by the USDA's estimates of both area
and yield," said Tobin Gorey, director of agricultural strategy,
Commonwealth Bank of Australia. 
    "Getting rid of that extra corn takes a lot more chewing,
distilling and shipping than the market was expecting."
    The U.S. corn harvest will be bigger than previously
forecast, the U.S. Department of Agriculture said on Monday, as
the government issued a surprise boost to its outlook despite
concerns about a wet spring and dry summer.
    For the 2019/20 crop year, the corn harvest will total
13.901 billion bushels, based on an average yield of 169.5
bushels per acre, the USDA predicted in its monthly supply and
demand report. 
    Wheat markets are also facing good world supplies and heavy
export competition. Wheat harvesting in Europe is generally
progressing well, with work in France almost finished.
    European Union soft wheat exports in the 2019/20 season that
started on July 1 had reached 1.33 million tonnes by Aug. 11,
down 30% compared with a year earlier, European Commission data
showed on Monday.
    The USDA lowered its soybean crop estimate to 3.680 billion
bushels from 3.845 billion bushels previously.
    Corn may fall further into a range of $3.50 to $3.71-3/4, as
it has broken a support zone of $3.89-1/2 to $3.92-3/4,
according to Wang Tao, a Reuters analyst for commodities
technicals.
    It is formed by the 50% retracement of the uptrend from
$3.14-3/4 to $4.64 and the 14.6% retracement of the downtrend
from $8.49 to $3.14-3/4, he said.    
    China's agriculture ministry on Monday said it had revised
down its estimate for 2018/19 soybean imports to 83.5 million
tonnes, down 1.5 million tonnes from last month's estimate, due
to lower-than-expected shipments in July.
    The ministry also upgraded its estimate for 2018/19 corn
imports to 4 million tonnes, an increase of 700,000 tonnes from
the previous month. The revised estimate for corn imports was
mainly due to a significant reduction in U.S. sorghum imports,
it said.
    Commodity funds were net sellers of CBOT corn, wheat,
soybean and soymeal futures contracts on Monday, traders said.
They were net sellers of soyoil futures.              
    
 Grains prices at 0402 GMT
 Contract    Last    Change   Pct chg  Two-day chg  MA 30   RSI
 CBOT wheat  472.00  0.25     +0.05%   -5.51%       498.09  34
 CBOT corn   386.00  -6.75    -1.72%   -7.60%       426.57  22
 CBOT soy    888.25  9.00     +1.02%   -0.39%       896.28  45
 CBOT rice   11.56   -$0.02   -0.13%   +17.31%      $10.31  47
 WTI crude   54.81   -$0.12   -0.22%   +0.57%       $56.42  
 Currencies                                                 
 Euro/dlr    $1.119  -$0.002  -0.22%   -0.10%               
 USD/AUD     0.6758  0.001    +0.09%   -0.43%               
 Most active contracts
 Wheat, corn and soy US cents/bushel. Rice: USD per
 hundredweight
 RSI 14, exponential
    

    
 (Reporting by Naveen Thukral; Editing by Joseph Radford)
  
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