GRAINS-Soybeans rally 2% on USDA crop report

U.S. soybean futures rose 2% on Wednesday, following heavy losses in the prior session, after the U.S. Department of Agriculture pegged the condition of crops below market forecasts.

Wheat rose 1% as U.S. crops struggle from recent unfavourable weather, while corn also edged higher.

The most-active soybean futures on the Chicago Board of Trade Sv1 were up 2.1% to $13.32 a bushel by 0612 GMT, having closed down 6.7% on Tuesday.

Traders said the oilseed was drawing support from the USDA crop condition report, although forecasts for cooler and wetter weather across a key growing region provided a ceiling to gains.

“The USDA crop condition report came in lower than the market had expected and that’s helped stoke a rebound, but you have the better weather outlook capping gains,” said a Melbourne-based grains trader who declined to be named as he is not authorised to talk to the media.

The USDA said soybean ratings fell by 1 percentage point, with 59% of the U.S. crop rated good to excellent, down from 60% a week ago, while analysts on average had expected no change.

The most active corn futures Cv1 rose 1.5% to $6.66 a bushel, having closed down 6.9% in the previous session.

The USDA rated 64% of the U.S. corn crop in good-to-excellent condition in its weekly crop progress report on Tuesday, steady with the previous week and in line with analyst expectations.

The most active wheat futures Wv1 added 0.9% to $6.31-1/2 a bushel, having closed up 2.1% on Wednesday.

Ratings for the drought-hit U.S. spring wheat crop fell more than expected. The USDA rated 16% of the crop as good to excellent, down from 20% a week ago. Analysts on average had expected a 1 point decline.
Source: Reuters (Reporting by Colin Packham; Editing by Amy Caren Daniel)