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imageCHICAGO: US wheat futures surged 2 percent to their highest levels in more than a year on Friday, bolstered by concerns of drought-reduced production in the southern Plains, where triple-digit temperatures could bake the crop this weekend.

Corn extended losses after a tumble on Thursday tied to investor profit-taking and improving conditions for spring plantings in the US Midwest, while soybeans were slightly higher in a bargain-buying bounce following their largest declines since September.

Temperatures in Kansas, Texas and Oklahoma were forecast to rise as high as 100 degrees Fahrenheit (38 degrees Celsius) from Sunday through Wednesday, according to the Commodity Weather Group, potentially damaging a hard red winter wheat crop already suffering from severe drought.

An annual crop tour of top-growing state of Kansas on Thursday estimated the poorest production prospects in more than a decade, while Informa Economics on Friday slashed its US winter wheat crop estimate by 120 million bushels to 1.496 billion bushels, the analytics firm said in a client note obtained by Reuters.

"The prediction is (for) 95-100 degree temps between now and Wednesday; that will literally cook what's left," Mark Hodges, executive director of Oklahoma-based growers group Plains Grains Inc, told the Thomson Reuters Global Ags Forum.

"We are beating a dead horse with crop conditions (but) unfortunately we still have downside potential," Hodges said.

The US Agriculture Department this week pegged the condition of the crop at 33 percent good to excellent, 1 percentage point lower than the previous week. The poor quality of the crop has fueled a rally in Kansas City Board of Trade wheat futures that have gained in eight out of the past nine trading sessions.

Most-active KC July wheat futures gained 17-3/4 cents to $8.21-1/2, with KC wheat on a continuous chart hitting the highest level since March 2013. CBOT July wheat was up 8-3/4 cents, or 1.2 percent, at $7.16. Wheat was up 1.1 percent for the week, the third straight weekly gain.

CORN LOWER, SOY HIGHER

Meteorologists forecast warmer and drier weather in the central and southern portions of the Midwest, which is expected to provide farmers an opportunity to catch up on behind-schedule plantings.

"We may see some fieldwork this weekend," said Tom Fritz, a partner at EFG Group in Chicago.

CBOT July corn fell 7-1/2 cents, or 1.5 percent, to $4.99-1/2. The weekly loss for corn of 2.6 percent was the biggest since November.

Corn was further pressured by unexpectedly large deliveries against May futures. The CME Group on Friday posted 226 deliveries at Burns Harbor, Indiana, a port terminal on Lake Michigan.

"The deliveries weighed on the old crop and you were also seeing a fair amount of wheat-corn spreading," Fritz said, adding that traders were betting that wheat prices would continue to rise and corn to decline.

Soybean futures were mostly higher, with the most-active July contract rising 9-3/4 cents to $14.70-3/4 per bushel even as Brazil reported record shipments of the beans in April

Massive soy harvests in South America have weighed on the market in recent weeks even as supplies dwindled in the United States. Soybeans shed roughly 1 percent for their second straight weekly drop.

But the biggest daily drop in soy prices in seven months on Thursday prompted traders to buy on the dip. Investment funds were said to have bought 5,000 soybean contracts and 4,000 wheat contracts, while selling 9,000 corn contracts.

"There were hefty fund sales on the US markets yesterday so we now see some buying at cheaper prices," Arnaud Saulais of Starsupply Commodity Brokers said.

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