Soybeans face biggest weekly loss in two years on U.S. weather

SINGAPORE (Reuters) - Chicago soybean futures were on Friday set for their biggest weekly decline since June 2014 as near-perfect U.S. weather boosted the prospects of a bumper crop.

Rows of corn wait to be harvested in a field in Minooka, Illinois, September 24, 2014.. REUTERS/Jim Young

Corn is poised for a third week of decline as the U.S. crop thrives in friendly weather in its crucial pollination phase, while wheat is on track to suffer its fifth week of losses.

Chicago soybean futures have lost nearly 10 percent this week, their biggest weekly fall since June 2014 as rains aid the U.S. crop and fears of dry La Nina weather pattern ease.

“There is long liquidation in soybeans,” said Kaname Gokon at brokerage Okato Shoji in Tokyo.

“There have been heavy rains in the U.S. Midwest which are good for the crop.”

Expectations by weather forecasters that the onset of a La Nina, which could trigger a dry summer in the U.S. Midwest, had been pushed back to September suggest soybeans will not get hit during their key development stage in August, CBA analysts said.

Corn has lost 4.5 percent this week, falling for a third consecutive week, while wheat is down more than 1 percent in its fifth week of losses.

Corn has given up close to 20 percent in three weeks and wheat has shed more than 14 percent in five weeks.

The U.S. corn crop is getting a boost from rains and ideal weather in its pollination phase.

Still, the decline in corn futures is being limited by Brazil’s Conab lowering its outlook for the country’s corn production to 69.14 million tonnes from 76.22 million, largely due to problems with the second crop.

Commodity funds were net sellers of Chicago Board of Trade soybean and wheat futures contracts on Thursday. Traders’ estimates of fund sales in soybeans ranged from 14,000 to 20,000 contracts.

Estimates for wheat ranged from net even to sales of 2,500 contracts. Traders estimated that funds were net even in corn. <COMFUND/CBT>

Meanwhile, exports of French soft wheat, which competes with U.S. wheat, to buyers outside the European Union rose in May to 1.6 million tonnes, the highest monthly volume since the 2015/16 season began in July last year.

Exports since the beginning of the 2015/16 season now total 11.4 million tonnes, up 12 percent from the July-May period in 2014/15.

Reporting by Naveen Thukral; Editing by Ed Davies and Joseph Radford