PARIS/SINGAPORE: Chicago wheat futures inched lower on Thursday as the market took a breather after a day-earlier rally, but remained underpinned by healthy export demand and an expected drop in US acreage that could help trim hefty wheat stocks.
US soybeans gave up earlier gains and edged down, pressured by a weaker trend on vegetable oil markets in Asia, while corn eased after a seven-month high on Wednesday supported by investment fund buying.
The Chicago Board of Trade most-active wheat contract fell 0.2 percent to $4.53-3/4 a bushel by 1237 GMT.
It remained close to Monday's peak of $4.56, a level not seen since late June, and was showing an 11 percent gain since the start of this year.
The wheat market's decline to a 10-year low in 2016 has discouraged plantings in the United States, and the prospect of a sharp production fall next season has encouraged investors to reduce short positions.
"If US wheat prices do not recover, we are again running the risk of losing winter wheat planted area in the next season," said Rajesh Singla, head of agriculture research at Societe Generale.
"High-quality US milling wheat is very much in demand, exports are running very strong."
World wheat stocks are forecast to reach a record level in 2016/17, but lower quality this season in several production zones has limited the availability of milling-grade wheat.
Weekly US export sales figures at 1330 GMT will give a fresh indication of demand for US supplies.
The most-active CBOT soybean contract was down 0.5 percent at$10.56-1/4 a bushel, having climbed 1.6 percent on Wednesday.
Corn gave up 0.4 percent to $3.77-1/4 a bushel, after touching its highest since July 14 at $3.79 in the previous session.
Commodity funds were net buyers of CBOT soybean, corn, soymeal and wheat
futures on Wednesday and net sellers of soyoil futures, traders said.
US soybean processors ramped up their pace of crushing above market forecasts last month, notching the third-busiest January on record, the National Oilseed Processors Association said on Wednesday.
"Regarding soybeans, the good crushing pace has surprised operators and led to buying trades despite excellent harvest prospects in the southern hemisphere," consultancy Agritel said in a note.
The oilseed faced some pressure on Thursday after a drop in Asian vegetable oil futures, with Malaysian palm oil slipping to its lowest in nearly three months.
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