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GRAINS-Soybeans near 2018 high as U.S. cuts supply forecast, corn firms

SINGAPORE, Oct 12 (Reuters) - Chicago soybean futures edged higher on Monday, trading near a more than two-year peak hit in the last session as the U.S. government’s estimate for lower supplies supported prices.

Corn rose for a second session while wheat gained ground.

FUNDAMENTALS

* The most-active soybean contract on the Chicago Board of Trade rose 0.1% to $10.66 a bushel by 0138 GMT, having risen to a 2018 high of $10.79-3/4 a bushel on Friday.

* Corn added 0.4% to $3.96-3/4 a bushel and wheat gained 0.3% to $5.95-1/4 a bushel.

* U.S. corn and soybean supplies will be smaller than previously forecast, as adverse weather reduced the acreage that farmers will harvest, the U.S. government said on Friday.

* Soybean stocks were pegged at a five-year low, with rising exports eating into the stockpile, according to the U.S. Agriculture Department’s monthly World Agricultural Supply and Demand Estimates Report.

* With U.S. soy supplies tightening, traders are increasingly turning their attention toward rival producer Brazil, where dryness has threatened plantings. Traders are also monitoring dryness that has hampered wheat plantings in the Black Sea region.

* Current dry weather may reduce Russia’s winter wheat sowing area by 10-15%, mainly in the central part of the country, the Sovecon agriculture consultancy said in a note on Friday.

MARKET NEWS

* Asian stock markets began the week with cautious gains on Monday, as investors clung to hopes for U.S. stimulus spending, while the dollar firmed after a Chinese central bank policy tweak unwound some of the yuan’s steep gains.

DATA/EVENTS (GMT) 1200 India Industrial Output YY Aug (Reporting by Naveen Thukral; Editing by Aditya Soni)

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