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Wheat dips after rally as market awaits data

Chicago wheat futures eased on Wednesday after a sharp rebound in the previous session as investors assessed harvest prospects while waiting for U.S. grain and inflation data.

Corn and soybeans edged higher, supported by firm crude oil prices.

The most-active wheat contract on the Chicago Board of Trade (CBOT) Wv1 was down 1.2% at $6.18-3/4 a bushel by 1030 GMT, after climbing more than 3% on Tuesday.

Wheat prices rallied on Tuesday, ending a nine-session slide, after the head of Russia’s grain union said frosts in Russia affected between 15% and 30% of winter grains, varying by region, a much higher figure than suggested by the agriculture ministry.

In addition, a surprise drop in weekly U.S. winter and spring wheat condition ratings underpinned prices.

A tender held by Egypt also brought fresh demand, though the country’s purchase of 400,000 metric tons of Black Sea-origin wheat underlined stiff competition.

Traders are squaring positions ahead of the U.S. Department of Agriculture monthly (USDA) supply-demand reports, due later in the day.

“Old-crop U.S. corn and soybean inventories will be closely watched, as will new-crop U.S. wheat production estimates,” Argus analysts said in a note.

Soybeans Sv1 gained 0.5% to $11.84-1/4 a bushel, while corn Cv1 added 0.7% to $4.52-3/4 a bushel.

Corn and soybean prices have been capped by a promising start to the U.S. growing season, though uncertainty over South American supply has lent some support.

Investors are also watching for U.S. inflation data on Wednesday ahead of a U.S. Federal Reserve policy statement.
Source: Reuters (Reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore; Editing by Sherry Jacob-Phillips and Janane Venkatraman)

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