February 8, 2018 / 10:42 PM / 8 months ago

GRAINS-Soybeans hit one-week top as Argentina weather woes simmer

 (Recasts, updates prices, adds quotes; changes byline,
dateline, previous LONDON)
    By Julie Ingwersen
    CHICAGO, Feb 8 (Reuters) - U.S. soybean futures set a
one-week high on Thursday as worries about dry weather
curtailing Argentina's harvest overshadowed bearish data in a
monthly U.S. Department of Agriculture report (USDA), analysts
said.
    Corn futures firmed on strong export demand while wheat
retreated on profit-taking after multimonth highs.
    Chicago Board of Trade March soybean futures settled
up 4-3/4 cents at $9.87-3/4 per bushel and March soymeal
closed up $6.30 at $341.70 per short ton after reaching $346,
its highest since Jan. 25.
    CBOT March corn ended up 1/2 cent at $3.65-3/4 per
bushel after touching $3.67-3/4, its highest since Oct. 25,
while CBOT March wheat finished down 4-1/4 cents at
$4.56-1/4 after recording a four-month high at $4.64-1/2.
    Strength in the soy complex was fueled by soymeal
futures, which surged on fears of a crop shortfall in Argentina,
the world's biggest exporter of the high-protein animal feed.
    The USDA in a monthly supply/demand report lowered its
estimate of Argentina's soybean crop to 54 million tonnes from
56 million last month due to "unseasonable warmth and dryness."
    The Buenos Aires Grains Exchange cut its estimate to 50
million tonnes, from 51 million previously, and Dan Basse,
president of AgResource Co, said some private analysts expect
the harvest to fall below 50 million tonnes.

    "Argentina exports (roughly) 50 percent of the world's meal.
If they start having a bean crop much less than 47 or 48
(million tonnes), it gets really tight. It's important that they
get some soaking rains, quickly," Basse said.
    CBOT soybean futures dipped briefly after the USDA raised
its forecast of U.S. soybean stocks left at the end of the
2017-18 marketing year to 530 million bushels, up from 470
million in January, citing reduced U.S. soybean exports.
    But worries about a drop in Argentina's soy output held the
spotlight.
    "The protein side of the equation is what the market is
looking at. Accordingly, (soymeal) is rallying because we just
can't afford an Argentine shortfall," Basse said.
    Corn futures rose on concerns about Argentine production and
strong export demand for U.S. supplies. The USDA, citing
dryness, lowered its corn production forecast for Argentina to
39 million tonnes from 42 million tonnes last month.

    CBOT corn futures pared gains, however, and even dipped
lower at times, pressured by U.S. farmer selling.
    CBOT wheat fell on profit-taking after the March contract
 hit $4.64-1/2, a four-month high.
    Worries about dryness in the U.S. Plains breadbasket
underpinned the market. But plentiful global wheat supplies
limited rallies, along with ideas that the run-up in futures
will curb U.S. export sales.
    After the close, Egypt's state wheat buyer set an
international wheat purchase tender, with results expected on
Friday.
             
    CBOT settlement prices:  
                        Last     Net     Pct  Volume
                              change  change  
 CBOT wheat     WH8   456.25   -4.25    -0.9  125785
 CBOT corn      CH8   365.75    0.50     0.1  314087
 CBOT soybeans  SH8   987.75    4.75     0.5  215452
 CBOT soymeal   SMH8  341.70    6.30     1.9  105827
 CBOT soyoil    BOH8   32.21   -0.35    -1.1   87048
   NOTE: CBOT March wheat, corn and soybeans shown in cents per
bushel, soymeal in dollars per short ton and soyoil in cents per
lb.

 (Additional reporting by Nigel Hunt in London and Naveen
Thukral in Singapore; editing by David Goodman and G Crosse)
  
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