US soybeans firm on South America weather worries

CHICAGO: US soybean futures rose on Wednesday on worries about poor crop weather reducing yield potential in South America, analysts said, while traders continued to watch for any developments in US trade relations with top global soy buyer China.

Wheat firmed on talk of tightening supplies and rising prices in Russia, the world's biggest exporter, while corn futures eased.

As of 12:52 p.m. CST (1852 GMT), Chicago Board of Trade (CBOT) March soybean futures were up 5-1/4 cents at $9.14-1/2 a bushel, staying inside of Tuesday's trading range.

CBOT March wheat was up 3-3/4 cents at $5.25 a bushel while March corn was down 3/4 cent at $3.78-1/4 a bushel.

"CBOT soybean futures rallied on the persistent dry pattern in northeastern Brazil/wet pattern in eastern Argentina that continues to threaten South American soybean production," DC Analysis president Dan Cekander wrote in a note to clients.

Forecasters have been scaling back estimates for Brazil's soybean harvest due to drought, and hot weather this week was expected to keep some regions dry.

The average estimate of Brazil's 2018-19 soybean production in a Reuters poll of analysts was 117.06 million tonnes, down from the average in a November poll of 120.8 million tonnes.

Looking ahead to US plantings for 2019, private analytics firm IEG Vantage, formerly known as Informa Economics IEG, projected that farmers would plant more corn and less soybeans and wheat compared to 2018.

The firm put 2019 soybean plantings at 86.2 million acres, up 1.1 million acres from its mid-December forecast, but still down nearly 3 million acres from 2018.

IEG projected US 2019 corn plantings at 91.5 million acres, up from the 89.1 million in 2018. The firm put total US wheat seedings for 2019 at 47.163 million acres, compared with the 47.8 million a year earlier.

Agricultural markets were also weighing prospects for progress in negotiations between Washington and Beijing over their trade dispute. Soybean and corn futures eased on Tuesday on reports the Trump administration turned down Chinese offers this week for preparatory trade talks.

But White House economic adviser Larry Kudlow later denied the preliminary trade meeting was cancelled.

CBOT wheat futures were buoyed by tightening supplies and rising prices in Russia and Ukraine after brisk early-season shipments by the Black Sea exporting countries.

Ukraine's agriculture ministry urged exporters to comply with an export memorandum as most of the agreed volume of wheat for the 2018-19 season had already been shipped.

A run of import tenders this week was also supporting wheat prices.