* USDA sees more wheat export demand, especially from China
* Corn follows wheat up on expectations of feed demand
* Soybeans higher on spillover strength, U.S. planting
* Weaker dollar adds support to dollar-denominated grains
(Updates with closing prices)
By Julie Ingwersen
CHICAGO, July 11 (Reuters) - U.S. wheat futures rose for a
fourth day on Thursday, as investors covered short positions
after the U.S. Department of Agriculture lowered its forecasts
of U.S. and global wheat stockpiles below trade expectations.
Corn and soybean futures followed wheat higher, with
benchmark November soybeans also posting a fourth straight
At the Chicago Board of Trade, wheat for September delivery
settled up 4 cents at $6.83 per bushel, paring gains
toward the close after reaching a two-week high of $6.93.
New-crop December corn ended up 5-1/2 cents at $5.27 a
bushel and new-crop November soybeans were up 6 cents at
$12.90-3/4 a bushel.
Wheat advanced after the USDA released monthly data during
the trading session. In its July supply/demand report, the
government lowered its forecast of 2013/14 U.S. wheat ending
stocks to 576 million bushels from its forecast of 659 million
in June and below the average analyst estimate of 632 million.
The government cited expectations for increased export
demand, especially from China.
"The new-crop wheat carry-out number should be seen as
pretty bullish," said Joe Vaclavik, president of Standard Grain
in Chicago. "At 576 (million bushels), I don't think anybody was
looking for a number that low. Exports are up, so there is your
culprit," Vaclavik said.
The USDA also slashed its forecast of global wheat ending
stocks for 2013/14 to 172.38 million tonnes, from 181.25 million
in June. If realized, the figure would be the smallest since
China, the world's top wheat grower, is expected to import
the highest volume of the grain in a decade in 2013/2014 after
its domestic harvest was damaged by bad weather, according to a
forecast by China National Grain and Oils Information Centre, an
official think tank.
China bought more than 1.3 million tonnes of U.S. wheat in
early July in a flurry of deals after U.S. prices fell to near
the lowest levels in a year.
Wheat and other grains also drew support from a sharp drop
in the dollar, after comments from Federal Reserve Chairman Ben
Bernanke indicated the U.S. central bank may not wind down its
economic stimulus program as soon as previously expected.
The U.S. dollar index was on track for a two-day
decline of more than 2.2 percent, its biggest since 2009. A
weaker dollar makes dollar-denominated commodities like grains
cheaper to overseas buyers.
As well, funds hold a net short position in CBOT wheat and
corn, leaving those markets vulnerable to bouts of
CORN, SOYBEANS FOLLOW WHEAT HIGHER
Corn followed wheat higher on tightening world stocks. The
USDA lowered its forecast of global corn ending stocks for
2013/14 to 150.97 million tonnes, from 151.83 million in June,
while the average analyst estimate was for 152.4 million.
The USDA also pared its forecast of China's 2013/14 corn
harvest to 211 million tonnes, from 212 million previously.
"I think the wheat demand showing up in China and the
Chinese corn crop reduction of 1 million tonnes has the trade
thinking that maybe the demand low in feedgrains is in," said
Mike Zuzolo, president of Global Commodity Analytics in
Also supportive, USDA in a weekly report showed export sales
of U.S. corn at 1.05 million tonnes, topping trade expectations
for 350,000 to 600,000 tonnes.
Soybeans rallied after dipping lower in response to the USDA
raising its forecast of U.S. 2013/14 soybean production and
The soy market rose on spillover strength from corn and
wheat, as well as concerns about U.S. soybean crop development
stemming from planting delays that have persisted from
springtime into the summer.
The USDA has projected 2013 soybean plantings at 77.7
million acres, but traders say planting delays due to excessive
rain in parts of the Midwest may prompt the government to lower
that figure later this year.
"From an agronomy standpoint, there is concern about what if
we have an early fall, or what if the plant shuts down," one
Chicago analyst said. "Nobody wants to sell (soybeans) until we
see the weather over the next 30 days."
Prices at 2:35 p.m. CDT (1935 GMT)
LAST NET PCT YTD
CHG CHG CHG
CBOT corn 560.75 7.00 1.3% -19.7%
CBOT soy 1472.00 7.25 0.5% 3.8%
CBOT meal 458.00 8.30 1.9% 8.9%
CBOT soyoil 46.53 -0.49 -1.0% -5.3%
CBOT wheat 683.00 4.00 0.6% -12.2%
CBOT rice 1538.00 9.00 0.6% 3.5%
EU wheat 199.25 1.75 0.9% -20.4%
US crude 104.79 -1.73 -1.6% 14.1%
Dow Jones 15,456 165 1.1% 18.0%
Gold 1284.90 21.26 1.7% -23.3%
Euro/dollar 1.3102 0.0128 1.0% -0.7%
Dollar Index 82.6880 -1.3640 -1.6% 3.7%
Baltic Freight 1139 9 0.8% 62.9%
(Additional reporting by Gus Trompiz in Paris and Naveen
Thukral in Singapore; editing by David Gregorio and Jim