Corn and soybean prices ease with focus on US yields

LONDON: Chicago corn futures were slightly lower on Wednesday, erasing some of the previous session's gains, with caution evident in the run-up to Thursday's US Department of Agriculture monthly supply and demand report.

While the agency is expected to lower its outlook for the US corn and soybean crop, it sprung a surprise last month with a higher than anticipated forecast.

"The yield estimates on this report will be watched closely as the data will include USDA field checks for the first time this year, mixed with their usual farmer survey," brokerage Allendale said in a market note.

The average estimate in a Reuters survey of analysts put US corn yields at 167.2 bushels per acre, down from the USDA's August forecast of 169.5 bushels.

The most-active corn contract on the Chicago Board Of Trade (CBOT) was down 0.2% at $3.60-3/4 a bushel as of 1120 GMT after rising on Tuesday following an unexpected decline in the US crop's condition.

Chicago soybeans also gave up some of Tuesday's gains with the most active CBOT contract down 0.2% at $8.70-1/2 a bushel.

Wheat prices were also lower with Chicago's most active contract down 0.6% at $4.79-1/4 a bushel.

In the previous session, wheat prices rose to their highest since Aug. 12 at $4.83-1/2 a bushel boosted by worsening crop outlooks in Australia and Argentina.

Australia trimmed its wheat production forecast for the 2019/20 season by nearly 10% on Tuesday, saying prolonged dry weather in some eastern regions had hurt crops.

Argentina's wheat crop could also be damaged by dry conditions.

December wheat on Euronext in Paris fell 0.15% to 169.75 euros a tonne.

Dealers said overall wheat supplies remained ample, noting that the Ukrainian grain traders' union UZA had upgraded its forecast for Ukraine's 2019 wheat crop to 28.3 million tonnes, 600,000 tonnes higher than its previous estimate.

Farm office FranceAgrimer also forecast that French soft wheat exports would rise in the 2019/20 season.