June 8, 2020 / 5:18 PM / a month ago

GRAINS-Soybeans hover near two-month top on strong demand

* Soybeans correct after week of strong export sales to China

* Corn strengthens on Ethanol revival

* Wheat trims as harvest mounts (New throughout; changes dateline, previous SINGAPORE/PARIS)

By Christopher Walljasper

CHICAGO, June 8 (Reuters) - Chicago soybean futures edged lower on Monday on technical selling, after reaching a two-month high following a week of strong export sales.

Corn gained as higher oil prices boosted hopes for ethanol demand and concerns loomed over mounting dryness in parts of the Midwest.

Wheat slipped as harvests in Texas and Oklahoma continue, while rains in the Northern Great Plains bolstered flagging crops across the Dakotas.

The most-active soybean contract on the Chicago Board Of Trade (CBOT) was down 3-1/2 cents at $8.64-1/2 a bushel at 11:26 a.m. CDT (1626 GMT). It hit $8.73-1/2 a bushel on Friday, the highest since April 1.

Corn rose 1-1/4 cent to $3.32-1/2 a bushel, while wheat fell 5-1/4 cents to $5.10 a bushel.

CBOT soybeans remained near two-month highs after U.S. exporters reported sales of soybeans four straight days last week in deals widely thought to be bound for China.

“I’m going to say this is a correction, following a pretty sizeable run-up,” said Joe Vaclavik, president of Standard Grain. “I don’t know that there’s anything fundamentally that’s led to this sell-off today.”

The U.S. Department of Agriculture on Friday reported 588,000 tonnes of soybean sales.

Corn rose on increased demand for the grain. Ethanol production is increasing as the U.S. economic reopening continues, while farmers remain hesitant to sell.

Large speculators increased their net short position in CBOT corn futures in the week ended June 2, regulatory data released on Friday showed.

“You may have some selling, and at least bull spreading the corn market,” said Mark Schultz, chief analyst at Northstar Commodity.

Harvesting in the U.S. Southern plains added to pressure on wheat. But it was supported by news parts of Russia could see the wheat crop fall by 40% compared with last year due to cold weather and drought. (Reporting by Christopher Walljasper; additional reporting by Naveen Thukral; Editing by Tom Brown)

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