March 6, 2018 / 1:55 AM / 3 months ago

GRAINS-Wheat drops more than 1 pct despite U.S. weather woes

    SYDNEY, March 6 (Reuters) - U.S. wheat futures fell more than 1 percent on Tuesday, though prices lingered near an eight-month high as adverse weather
conditions threaten to crimp production from the world's largest exporter. 
         
    FUNDAMENTALS  
    * The most active wheat futures on the Chicago Board Of Trade were down 1.3 percent at $5.02-3/4 a bushel, by 0125 GMT, after closing up 1.9 percent on
Monday. Wheat hit a high of $5.18-1/2 a bushel last week, the highest since July 2017.
    * The most active soybean futures slipped 0.3 percent to $10.74-1/4 a bushel, after closing 0.6 percent higher in the previous session.
    * The most active corn futures slid 0.4 percent to $3.85-3/4 a bushel, having ended 0.5 percent higher in the previous session.
    * Wheat has drawn recent support amid forecasts for continued dry weather across the U.S. Plains, threatening a crop that has already been damaged by adverse
weather.
    * U.S. Department of Agriculture will on Thursday issue its latest monthly supply and demand report, in which analysts expect the government to show slightly
larger U.S. wheat ending stocks. Analysts also predicted USDA would hike Brazilian soy output and lower soy output in Argentina.

    * The deepening drought in the Pampas grain belt has led forecasters to cut estimates for the forthcoming Argentine soybean crop, prompting investors to
raise their long position in Chicago futures. 
            
    MARKET NEWS  
    * The dollar edged higher versus the yen on Tuesday, supported by receding fears about a trade war stemming from U.S. President Donald Trump's proposed
tariffs on imported steel and aluminium.  
    * Crude prices rose on Monday along with the U.S. stock market on forecasts for robust oil demand growth and concerns that output from OPEC producers would
grow at a much slower pace in coming years.  
    * U.S. stocks rallied on Monday as fears of a global trade war ebbed with investors betting that U.S. President Donald Trump would back down on his threat to
impose hefty tariffs on steel and aluminium imports.  
        
 Grains prices at 0125 GMT
 Contract       Last  Change  Pct chg  Two-day chg    MA 30   RSI 
 CBOT wheat   502.75   -6.50   -1.28%       +0.55%   470.51     69
 CBOT corn    385.75   -1.50   -0.39%       +0.13%   373.11     72
 CBOT soy    1074.25   -3.25   -0.30%       +0.30%  1024.11     84
 CBOT rice     12.47  -$0.01   -0.04%       +0.00%   $12.45     59
 WTI crude     62.79   $0.22   +0.35%       +2.51%   $62.85     56
 Currencies                                                       
 Euro/dlr     $1.235  $0.002   +0.15%       +0.30%                
 USD/AUD      0.7781   0.002   +0.22%       +0.24%                
 Most active contracts
 Wheat, corn and soy US cents/bushel. Rice: USD per hundredweight
 RSI 14, exponential
 
 (Reporting by Colin Packham, Editing by Sherry Jacob-Phillips)
  
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