Wheat drops for fourth session, corn near three-week low

SINGAPORE: Chicago wheat fell for a fourth consecutive session on Tuesday with prices pressured by improved weather conditions in the US southern Plains although a lack of protective snow cover kept a floor under the market.

Corn ticked higher after dropping to a near three-week low on Monday while soybeans were little changed, having closed lower in the last session.

The market focused on a monthly US Department of Agriculture (USDA) report which is expected to show abundant global supplies of grains and oilseeds.

The most-active wheat contract of the Chicago Board of Trade slid 0.1 percent at $4.27-1/4 a bushel by 0314 GMT. It ended Monday down 0.7 percent, after falling to as low as $4.25-3/4, the weakest since Dec. 29.

Corn gained 0.2 percent at $3.48 a bushel after dropping to as low as $3.46-3/4 in the previous session, the lowest since Dec. 19. Soybeans added 0.1 percent to $9.67-1/2 a bushel, having closed down 0.4 percent on Monday.

Wheat prices have been supported by fears that frigid weather might damage crops across key US producing regions, which are already struggling with persistent dry weather.

Temperatures warmed up and rains arrived in parts of southern Plains wheat areas, alleviating some concerns about damage to plants, before bitter-cold conditions return next week, according to the Commodity Weather Group.

"US weather has been pretty cold and wheat areas have very little snow cover," said Phin Ziebell, agribusiness economist at National Australia Bank. Snow helps to insulate winter wheat crops from damage caused by cold temperatures.

"Russia also has weather issues but we always talk about these concerns and at the end we get a decent harvest."

Analysts expect the USDA to show abundant global grain and soybean supplies in monthly and quarterly reports due on Friday. The reports tend to spur increased volatility in futures.

For soybeans, the drought afflicting Argentina's crop belt is expected to worsen this week, pushing farmers to risk planting later than usual and raising the risk of frosts later in the season, a meteorologist and a farmer said on Monday.

In Brazil, a cold front which is prompting rains in the southeast and center-west may delay early harvesting, weather forecaster Marco Antonio dos Santos said in a Monday report.

Commodity funds were net sellers of CBOT corn, wheat, soybean, soyoil and soymeal futures contracts on Monday, traders said.