There was also pressure from spreading activity, with traders selling soybeans and buying corn. Grain markets shrugged off pressure from a sharply higher US dollar, on technical buying of corn and after the US government lowered its view of end-of-season wheat supplies. Drought in South America reduced the soybean crop in Brazil, the world's No. 1 exporter, by 9 percent in three months and the crop in Argentina by 11 percent, the US Agriculture Department (USDA) said on Friday in cuts larger than traders had expected. "My sense is that while the South American (soy) crops are still lower than the USDA indicated today, USDA made, for them, a fairly aggressive reduction," said Anne Frick, analyst at Jefferies Bache. Soybeans also slipped because of unwinding of soymeal-soyoil spreads, said Mike Zuzolo, analyst at Global Commodity Analytics. "That spread has been red-hot and led the bean market higher for several weeks at the expense of the bean oil going down, and I think you're seeing a very big position unwinding of that bean meal-bean oil spread," Zuzolo said. The benchmark Chicago Board of Trade May soybean contract slipped 0.3 percent, or 4-1/4 cents, at $13.34-1/4 per bushel as of 12:12 p.m. CST (1746 GMT). May soybeans were well off their overnight five-month high of $13.55-1/2, and failing to close above that level would be bearish heading into next week, Frick said. Soybeans set the upward tone for grains, even if corn and wheat were stronger, because of overbought conditions, said Arlan Suderman, market analyst at Farm Futures magazine. "If you look at the pattern this winter, it has been for corn and wheat to grind higher until it reaches a crop report, then crash, and then we grind higher," Suderman said. "We took corn down the last couple of days, so we flushed that (cyclical dip) out." Traders were digesting revised US planting forecasts from analysis firm Informa Economics at mid-morning. Informa raised its corn seeding estimate to 95.513 million acres from 94.748 million acres, according to the trade, causing new-crop December corn to pare gains. Informa also bumped up US soybean plantings to 75.128 million acres from 74.568 million acres, the trade said, and trimmed all-wheat plantings to 57.745 million acres from 57.9 million acres. May corn gained 1.8 percent or 11-1/2 cents to $6.47 per bushel, with technical buying and rumors of China purchases adding to support. Corn was headed lower for the week. USDA pegged 2011/12 global corn ending stocks at 124.53 million tonnes, above an average of analysts' estimates for 123.469 million and below USDA's forecast in February for 125.350 million tonnes. Despite the crop damage in South America, USDA left its estimates unchanged for US corn and soybean ending stocks. Traders had been expecting some reductions on the grounds US exports would rise to make up for the shortfall in South America. Chicago May wheat gained 1.3 percent or 8-1/2 cents to $6.43-1/4 per bushel, but was still headed for a weekly drop. Larger exports will reduce 2011/12 US wheat stocks to 825 million bushels, versus higher expectations for 836 million bushels, according to the USDA, while its forecast for world wheat supplies at the end of the season was also surprisingly low. "The friendly one was wheat," said Mark Schultz, chief analyst with Northstar Commodities. "Even though the numbers were neutral to a little on the friendly side, we sold off pretty hard in these markets coming in." Wheat's gains were held in check by forecasts for rain in hard red winter wheat growing areas of the US Plains as well as spring wheat production areas, said Don Keeney, meteorologist for MDA EarthSat Weather.