SINGAPORE: Chicago soybeans rose for a fifth straight session on Monday, climbing to a three-month top on prospects of higher demand for US beans following concerns over supplies from drought-hit South America.
Wheat and corn slid, with the grain markets pressured by Russia's announcement on Friday that it sees no need for grain export restrictions in April.
An update on how badly the drought has damaged crops in agricultural powerhouses Argentina and Brazil and how much of their export business could shift to the United States will be at the heart of grains trading this week.
The US Department of Agriculture's supply-demand report on Thursday will provide the eagerly awaited data. Traders have been closely tracking weather conditions in the South American countries to get an assessment of the damage.
"We are looking at higher corn because of lower supply from Argentina which could be reflected in Thursday's USDA report," said Lynette Tan, analyst with Phillip Futures in Singapore.
"For wheat there is more downside, mainly because of ample supplies and Russia's move to continue with exports."
Chicago Board of Trade March soy rose around half a percent to $12.38 a bushel, highest since Oct. 28. At 0332 GMT it was trading at $12.35-1/2 a bushel.
March wheat lost 0.6 percent to $6.57 a bushel, after rallying for three weeks in a row, while corn for March delivery fell 0.4 percent to $6.42 a bushel, snapping four straight sessions of gains.
Rains have been forecast this week in key growing regions of Argentina but dry weather over the past month was likely to reduce yields in the No. 3 world soy exporter.
Closely-watch analytics firm Informa Economics lowered its forecast for soy production in Argentina and Brazil, helping to lift soybean futures to the highest level since October.
Export shipments of US soybeans were above 1 million tonnes for the third week in a row, US Agriculture Department data showed on Thursday even as new sales of 368,400 tonnes fell below analyst estimates.
Still, rains soaked parched Argentine 2011/12 soy crops and helped recovery of even hard-hit early-seeded fields after weeks of drought.
Argentina's vast Pampas grains belt has endured hot and dry weather since December but recent rains have been timely for the country's soy fields.
In the wheat market, prices came under pressure as Russia's government said it saw no need for grain export restrictions in April and raised its grain export forecast for 2011/12 by 12.5 percent.
Wheat has been supported over recent weeks on fears Russia -- the world's third largest exporter -- would cap shipments, with prices gaining almost 10 percent in the last three weeks.
The market is also expecting the USDA could spring a surprise by making a sharp cut to its estimate of corn production in drought-hit Mexico, a major importer of the grain from the United States.
Some traders were expecting Mexico's corn crop to be as low as 14 million tonnes, far less than USDA's January forecast of 20.5 million tonnes.
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