U.S. grains: Wheat drops on profit-taking

Chicago | Reuters — Chicago Board of Trade wheat futures sank 3.2 per cent on Friday, following a six-day rally that had pushed prices to their highest in 7-1/2 months, traders said.

“This has just been a fantastic week of gains,” said Bill Gentry, a broker at Risk Management Commodities. “The funds are taking a little bit of profit ahead of the weekend.”

The sharp decline in wheat weighed on the corn market, which sagged after peaking at its highest since August.

Soybean futures, which hit their highest since July 2016, closed in positive territory after trading both sides of unchanged during the session. The soy market remained underpinned by signs of good export demand and expectations that dry weather will cut the size of the Argentine harvest and further boost the desirability of U.S. exports to overseas buyers.

K.C. hard red winter wheat futures weakened, but held up better than CBOT wheat contracts due to forecasts for below-normal moisture levels over the next few weeks in the U.S. Plains.

CBOT May soft red winter wheat futures settled down 15-1/2 cents at $5 a bushel (all figures US$). K.C. hard red winter wheat for May delivery was down 9-3/4 cents at $5.33-3/4 a bushel.

For the week, CBOT wheat rose 7.5 per cent and K.C. wheat rose 10.2 percent.

CBOT May soybean futures closed up three cents at $10.71 a bushel. Soybean futures rose 2.2 per cent this week, their fourth straight of week of gains.

The U.S. Department of Agriculture early on Friday said that private exporters reported the sale of 198,000 tonnes of soybeans to China, the second day in a row a sale to the world’s biggest buyer of the oilseed has been announced.

Dry weather in Argentina, the world’s biggest soyoil and soymeal supplier, remains a critical market factor.

Crop conditions for drought-battered corn and soybeans in Argentina worsened this week and ratings among the top three provinces are now on average about 23 percentage points lower than a month ago.

Private analytics firm Informa Economics on Friday cut its forecast for Argentina’s 2017-18 soybean harvest by seven million tonnes, to 44 million tonnes.

It also lowered its estimate of the country’s 2017/18 corn production to 33.5 million tonnes from 37 million tonnes.

CBOT May corn futures dropped one cent to $3.85-1/4 a bushel on Friday. Corn rose 5.1 per cent this week.

— Mark Weinraub reports on commodity markets for Reuters from Chicago; additional reporting by Naveen Thukral in Singapore and Sybille de La Hamaide in Paris.

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