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Wheat falls for fifth day on supply pressure; corn, soybeans firm

Chicago wheat futures fell for a fifth consecutive session on Wednesday, their worst losing streak since February, after a U.S. government report raised its estimate for world wheat inventories.

Corn and soybeans edged higher after closing almost unchanged on Tuesday.

The most-active wheat contract on the Chicago Board of Trade was down 0.3 percent at $4.58-1/4 a bushel by 0600 GMT, corn gained 0.3 percent to $3.61 a bushel and soybeans were up 0.2 percent at $9.00-1/4 a bushel.

The five days of losses for the wheat contract are the worst streak of declines since prices dropped for six days in a row from Feb. 25 to March 4.

The wheat market is under pressure after the U.S. Department of Agriculture (USDA) in a monthly report on Tuesday raised its forecast of global 2018/19 wheat ending stocks to 275.61 million tonnes, topping the highest in a range of trade expectations.

“The USDA cut their forecast of U.S. exports for season 2018,” said Tobin Gorey, director of agricultural strategy at Commonwealth Bank of Australia. “The wheat that was not exported is largely forecast to end up in inventories.”

The agency raised its outlook for how much corn will be left in grain elevators ahead of harvest this year due to falling demand from the export, feed and residual and ethanol sectors.

The USDA also boosted its estimate of domestic wheat supplies. However, it trimmed its outlook for soybean stocks for the third report in a row.

The USDA in a weekly crop progress report late on Monday rated 60 percent of the U.S. winter wheat crop in good-to-excellent condition, up from 56 percent a week earlier, a sign of improving yield prospects. Analysts on average had expected no change in weekly ratings.

A spring snowstorm was forecast to cross parts of Nebraska, South Dakota, Minnesota and Wisconsin starting Wednesday, potentially dumping 8 to 16 inches of snow, the Commodity Weather Group said in a client note. Farmers in those areas are trying to prepare fields for the seeding of spring crops including corn.

CBOT soybean May contract may retest a support at $8.97-1/2 per bushel, with a good chance of breaking below this level and falling to the next support at $8.92, Wang Tao, Reuters market analyst for commodities and energy technicals, wrote in a report.

Commodity funds were net sellers of CBOT wheat and soybean futures contracts on Tuesday and net buyers of soyoil, traders said.

Estimates of fund activity in corn ranged widely, from net sales of 12,500 contracts to net purchases of 8,000 lots.

Grains prices at 0600 GMT

 Contract    Last    Change  Pct chg  Two-day chg  MA 30   RSI
 CBOT wheat  458.25  -1.25   -0.27%   -2.03%       459.13  38
 CBOT corn   361.00  1.00    +0.28%   -0.41%       369.04  39
 CBOT soy    900.25  1.50    +0.17%   +0.14%       902.05  51
 CBOT rice   10.40   $0.11   +1.07%   -1.09%       $10.79  29
 WTI crude   64.12   $0.14   +0.22%   +1.65%       $59.20  
 Currencies                                                
 Euro/dlr    $1.126  $0.005  +0.43%   +0.37%               
 USD/AUD     0.7143  0.004   +0.53%   +0.45%

Most active contracts
Wheat, corn and soy US cents/bushel. Rice: USD per hundredweight
RSI 14, exponential
Source: Reuters (Reporting by Naveen Thukral; Editing by Christian Schmollinger and Sherry Jacob-Phillips)

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