US wheat futures fell more than 2 percent on Tuesday, giving up all the prior session's gains, as a further improvement in the condition of the US winter crop placed attention back on ample global supply of the staple cereal. Corn prices eased, following wheat lower and further pressured by lackluster export demand and ample supplies.
Soyabeans failed to hold early short covering and technical buying gains and ended near unchanged. Soyabeans hit a 6-1/2-year low the previous session as the market anticipated Argentina's newly elected president would enact policies that could help boost exports, adding to volumes from bumper harvests around the world.
Strength in the dollar further pressured grains markets. The US currency eased only slightly the day after touching an eight-month high against a basket of currencies.
But news that Turkey downed a Russian warplane lifted gold and provided broad support to commodities markets.
The US winter wheat crop condition was rated 53 percent good-to-excellent, up from 52 percent a week ago, the US Department of Agriculture said late on Monday.
This was still below a corresponding 58 percent rating a year ago but showed the US wheat plants were still benefiting from rainfall after suffering from dryness at the start of the growing season.
"Wheat is heading into dormancy with a really high rating. The only hope that the complex really had was some sort of problem with production," said Karl Setzer, analyst with MaxYield Co-operative.
Chicago Board of Trade December wheat fell 10-3/4 cents, or 2.2 percent, to $4.84-1/4 a bushel after climbing 1.6 percent in the last session.
CBOT December corn dropped 3 cents, or 0.8 percent, to $3.64-1/4 a bushel, giving up some of its 1.1 percent gain in the previous session. A recently narrowing wheat-to-corn price ratio added pressure to corn as wheat prices plunged.
January soyabeans closed 1/2 cent lower at $8.63-3/4 a bushel after breaking through chart resistance at their 20-day moving average but failing to hold the gains. The front-month soyabean contract hit its lowest level since March 2009 on Monday at $8.44-1/2 a bushel, before having a technical bounce.
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