Corn, soybeans ease ahead of USDA report

CHICAGO: US corn and soybeans futures drifted lower on Thursday ahead of a key U.S. government report due on Friday expected to raise estimates of U.S. 2018 corn and soybean plantings.

Wheat also eased, pressured by an accelerating U.S. winter crop harvest and reports of higher-than-expected yields in some areas.

Favorable crop weather around the U.S. farm belt weighed on grain markets in general, but declines were limited by U.S. Department of Agriculture weekly data showing good export sales following recent price declines.

Chicago Board of Trade August soybean futures fell 1-3/4 cents to $8.71-1/4 a bushel by 11:44 a.m. CDT (1644 GMT) after earlier touching a 1-1/2 week low. New-crop November soybeans fell 3/4 cent to $8.88-1/4 a bushel.

CBOT September corn was down 3/4 cent at $3.61 a bushel and new-crop December eased 3/4 cent to $3.72-1/2 a bushel.

CBOT September wheat declined 2 cents to $4.86-1/2 a bushel.

The USDA on Thursday reported soybean export sales last week at 358,500 tonnes, in line with trade estimates, and new-crop sales at 642,300 tonnes, above expectations.  China cancelled 120,000 tonnes of purchases, but sales to atypical buyers were large.

U.S. soybean prices have come under pressure from higher import tariffs by top buyer China set to take effect on July 6 amid a trade fight with Washington. Meanwhile, Brazilian soy prices have soared.

"The market doesn't like to see China switching out of U.S. exports, but sales are going to countries we don't normally do business with," said Ted Seifried, analyst with Zaner Ag Hedge.

"Global end-users are looking at the $1-plus (per bushel) discount of U.S. soybeans versus Brazil and figuring this is not a bad time to get some beans on the books," he said.

Corn and wheat export sales were at or above trade expectations.

Agricultural markets are bracing for the U.S. Department of Agriculture's acreage and quarterly stocks reports on Friday.

Analysts on average expect the USDA to raise the estimate of U.S. corn and soybean plantings from its March forecast, and to report multi-year highs in U.S. June 1 corn and soy stockpiles.

"Corn and soybean prices are under pressure ahead of tomorrow's figures for U.S. stocks and planted acreage," Commerzbank said in a note.

"Looking at the average estimates, June stocks of corn are likely to be the highest since 1988, while June stocks of soybeans are even expected to set a new record."