U.S. soybeans, wheat, corn close lower after early gains

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CHICAGO - U.S. soybean, corn and wheat futures fell on Friday, with all three commodities facing pressure after rising early in the session.

Soybean futures hit their highest in more than three weeks after the U.S. Agriculture Department at its annual Outlook Forum projected domestic soybean ending stocks for the 2020/21 marketing year would fall to a four-year low.

But the market gave up its gains after failing to breach a key technical point. Traders also were focused on signs of tepid demand from China.

"Beans exploded out of the gate on the USDA’s surprising low ending stocks estimate, but couldn’t hold the gains as the market still wants to see evidence of Chinese buying in the U.S. market," ED&F Man Capital said in a note to clients.

Chicago Board of Trade March soybean futures settled down 2-1/4 cents at $8.90-1/2 a bushel. The contract briefly topped $9 a bushel but retreated from the session peak after hitting technical resistance at its 30-day moving average.

Potential rallies in soybeans have been kept in check as purchases by top buyer China have remained tepid despite the Phase 1 trade deal. The latest weekly export data showed sales to China of just 11,484 tonnes, the lowest weekly total since early September.

"The soybean market is waiting for Chinese purchases that are taking their time to materialize," said Nathan Cordier of Agritel. "But it's difficult for the market to go much lower when investment funds already have very short positions."

CBOT May corn futures ended down 2 cents at $3.80-3/4 a bushel.

USDA pegged the U.S. corn crop at 15.5 billion bushels, which would cause ending stocks to balloon to 2.637 billion bushels. If realized, that would be the largest stockpile since 1988.

The export sales report provided some support. USDA said weekly export sales of corn totaled 1.25 million tonnes, just above the high end of market forecasts that ranged from 700,000 tonnes to 1.2 million tonnes.

CBOT May wheat fell 7-1/4 cents to $5.52 a bushel.

USDA reported weekly wheat export sales of 406,400 tonnes, near the low end of trade forecasts that ranged from 400,000 to 700,000 tonnes. (Additional reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore; Editing by Sherry Jacob-Phillips, David Goodman and Dan Grebler)