|12 September, 2019

Corn, soybean futures firm ahead of USDA supply-demand report

The most-active soybean contract on the Chicago Board Of Trade gained 0.5% to $8.70-1/2 a bushel

Sweetcorn is displayed inside at RHS (Royal Horticultural Show) London Harvest Festival Show on October 7, 2014 in London, England.

Sweetcorn is displayed inside at RHS (Royal Horticultural Show) London Harvest Festival Show on October 7, 2014 in London, England.

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SINGAPORE  - Chicago corn and soybean futures gained ground on Thursday as traders squared positions ahead of a widely watched U.S. Department of Agriculture (USDA) report scheduled to be released later in the session.

Wheat edged higher, after Wednesday's fall on bumper supplies from top exporting countries.

The most-active soybean contract on the Chicago Board Of Trade gained 0.5% to $8.70-1/2 a bushel by 0339 GMT, having closed down 0.6% on Wednesday. Corn added 0.2% to $3.60-3/4 a bushel and wheat was up 0.1% at $4.77-3/4 a bushel.

The market is awaiting the USDA report, which is expected to show smaller U.S. corn and soybean crops, after the agency sprung a surprise last month with a higher-than-anticipated forecast.

Warmer-than-normal weather across much of the U.S. Midwest is expected to accelerate the maturity of late-planted crops, reducing the risk that frost would damage yields.

Hopes for renewed Chinese purchases of U.S. agricultural products could provide support to the market ahead of high-level trade talks next month between the two countries.

China announced a short list of tariff exemptions on Wednesday, but key farm products were not included.

"The market was briefly disappointed not to make China's list of tariff exclusions but that passed quickly," said Tobin Gorey, director of agricultural strategy at Commonwealth Bank of Australia.

"The market clearly has an eye on the USDA's update of their crop forecasts later today."

There could be more pressure on the U.S. soybean market if China starts taking South American soymeal.

Argentine soybean farmers and crushers expect a boost in demand next year after the South American grains giant won long-sought approval from China to export soymeal to the world's biggest consumer of the livestock feed.

Abundant supplies are keeping a lid on wheat futures. French soft wheat exports outside the European Union are expected to climb to a four-year high in 2019/20 as the EU's biggest grain producer shifts a bumper harvest, farm office FranceAgriMer said on Wednesday.

Exports of soft wheat, France's main cereal crop, are projected to increase nearly 14% from the last season to 11.0 million tonnes, the highest since 2015/16, FranceAgriMer said in its first supply-and-demand outlook for the 2019/20 season that started in July.

Commodity funds were net sellers of Chicago Board of Trade wheat, corn, soybean and soymeal futures contracts on Wednesday and net buyers of soyoil, traders said.             

(Reporting by Naveen Thukral; Editing by Subhranshu Sahu)

© Reuters News 2019

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