Grain futures weaken

US grain futures weakened on Thursday, as expectations for an increase in global supply and concerns about the economy halted a two-day advance in soyabeans. Soyabeans had closed higher for the previous two days in a modest rebound from a drop to 4-1/2-month lows intraday on Tuesday.
Expanding supply forecasts have weighed on the soya market since the US Department of Agriculture, in a crop report on Friday, made a surprisingly big increase to its estimate of the US soya harvest and raised its outlook for global stocks. "We're still getting over last week's crop increase, and things are going fairly well in South America," said Jim Gerlach, president of A/C Trading. The market is keeping a close watch on soyabean planting in Brazil and Argentina - the world's second- and third-largest exporters, respectively - with buyers expecting bumper crops early next year to ease global supply tightness.
Conditions in central and northern Brazil are "near ideal" thanks to timely rains, said Don Roose, president of brokerage US Commodities. Markets also felt pressure from concerns the US economy could slip into recession if no deal is reached in Washington to avoid a combination of government spending cuts and tax increases taking effect in January, he said. January soyabeans tumbled 1.2 percent to $14.02 a bushel at the Chicago Board of Trade. December corn eased 0.6 percent to $7.21-1/4 a bushel, while December wheat was down 0.4 percent at $8.45-1/2 a bushel.
Commodity funds sold an estimated 5,000 contracts each of soyabeans and corn and 3,000 wheat contracts, traders said. Wheat closed lower for a fifth consecutive session amid technical selling, its longest losing streak in 2-1/2 months, analysts said. Expectations that relatively ample US supplies may be needed to make up for shortfalls among other major exporters helped limits losses, they said. Traders are "getting close to the point of seeing Ukraine just about out of the markets," said Jack Scoville, vice president for Price Futures Group.
Egypt, the world's biggest importer of wheat, will strike Ukraine from its list of suppliers in 2013 after receiving notification of an export halt from December 1, according to the government's main buyer. The announcement was not a surprise following recent talk about export curbs by Ukraine, according to traders. However, "the chances improve by the day that we'll actually do some business," Scoville said, referring to the United States.