Wheat hits 1-week low on higher US output, soybean prices ease

SINGAPORE: Chicago wheat slid for a third consecutive session on Monday, hitting a one-week low under pressure from a forecast for higher production in the United States.

Soybean prices dropped after climbing almost 1 percent on Friday, while corn was little changed.

The US Department of Agriculture reported US 2017 production of spring wheat other than durum at 416 million bushels, up from its previous estimate of 402 million bushels and well above an average of analyst estimates for 382 million bushels.

The government put the US all-wheat crop at 1.741 billion bushels, above the average trade estimate of 1.718 billion bushels.

In its quarterly stocks report released on Friday, the USDA showed that the United States burned through corn and soybeans at a furious clip during June, July and August.

But despite the strong demand, farmers and grain handlers were still left with corn ending stocks at a 29-year peak and soybean ending stocks at a 10-year high.

"The USDA keep surprising us," said one India-based commodities analyst, declining to be identified.

"We were expecting farmers to have abandoned large areas planted with spring wheat in the United States. Now it looks like that was not the case."

The Chicago Board of Trade most-active wheat contract was trading 0.2-percent lower at $4.47-1/4 a bushel at 0307 GMT, after dropping earlier in the session to it lowest since Sept. 25 at $4.44-3/4 a bushel.

Soybeans gave up 0.3 percent to $9.65-3/4 a bushel, while corn was unchanged at $3.55-1/4 a bushel.

Brazilian soybean producers had planted 1.5 percent of the 2017/18 crop through Sept. 28, below the level of 4.8 percent at this time last year, consultancy AgRural said in a statement on Friday.

The current planted area is also below a five-year average of 2.3 percent, AgRural said, citing scarce rains in key producing regions.

Australia's wheat production is likely to fall to its lowest since 2007/08 amid persistent dry weather, missing official forecasts made earlier this month as well as the USDA's latest estimate, a Reuters poll showed.

Large speculators increased their net short position in CBOT corn futures in the week to Sept. 26, regulatory data released on Friday showed.

The Commodity Futures Trading Commission's weekly commitments of traders report also showed that noncommercial traders, a category that includes hedge funds, trimmed their net short position in CBOT wheat and trimmed their net short position in soybeans.