Grains - Soybeans ease off 3-week high on upbeat South America crop

Investing.com - U.S. grain futures were mostly lower during European morning trade on Thursday, with soybean prices easing off a three-week high as traders continued to closely monitor crop prospects in major South American growers

Corn and wheat prices edged lower after hitting multi-week highs during the previous session.

On the Chicago Mercantile Exchange, soybeans futures for March delivery traded at USD14.2862 a bushel, down 0.5% on the day. The March contract fell by as much as 0.7% earlier to hit a daily low of USD14.2612 a bushel.

Soy prices rallied to a three-week high of USD14.4137 a bushel on Wednesday, boosted by indications of robust demand for U.S. supplies of the oilseed.

Prices of the oilseed came under pressure as market players continued to monitor crop conditions in Argentina and Brazil. The countries will harvest their crops during the next three to four months.

Industry group Oil World said that output in Brazil may be higher than estimated last month after recent rainfall. The U.S. Department of Agriculture estimated last week that Brazil will harvest a record 82.5 million tonnes of soybeans this spring.

Oil World also said that drier weather in Argentina in the two weeks to January 10 most likely aided planting and development of the soy crop.

Meanwhile, corn futures for March delivery traded at USD7.2888 a bushel, down 0.45% on the day. The March contract fell by as much as 0.5% earlier in the session to hit a daily low of USD7.2812 a bushel.

Prices rallied to USD7.3487 a bushel on Wednesday, the strongest level since December 10.

Prices of the grain have been on an uptrend since last Friday’s upbeat USDA report, which pegged the U.S. corn stockpile on December 1 at 8.03 billion bushels, down 17% from a year earlier and the smallest for that date since 2003.

Inventories at the end of the crop's marketing year on August 31 were projected to total 602 million bushels, a 17-year low.

The U.S. corn harvest will total 10.78 billion bushels, down from 12.36 billion collected in 2011 and the lowest in six years.

Corn future prices have gained nearly 8% since falling to a six-month low of USD6.7812 a bushel on January 7, as traders bet weaker prices will increase demand for U.S. supply.

Elsewhere, wheat for March delivery traded at USD7.8162 a bushel, down 0.45%. The March contract declined by as much as 0.9% earlier to hit a session low of USD7.8112 a bushel.

Wheat futures climbed to USD7.9062 a bushel on Wednesday, the highest since December 26.

Sentiment on the grain remained upbeat after the USDA cut its forecasts for U.S. wheat reserves at the end of the crop's current marketing year on May 31 to a four-year low of 716 million bushels, 5% lower than the agency’s December estimate.

Government data also showed that U.S. farmers planted 41.82 million acres of wheat, 2% below analysts’ expectations.

Wheat futures are up approximately 7% since dropping to a six-month trough of USD7.3637 a bushel on January 11, as hedge funds and large institutional investors returned to the market amid speculation prices have bottomed out.

Corn is the biggest U.S. crop, followed by soybeans, government figures show. Wheat was fourth, behind hay.