CANBERRA: Chicago soybean futures held near 22-month lows on Thursday as an upgrade to Argentina’s projected harvest raised expectations of plentiful supplies from South America, with traders shrugging off an expected downgrade for the U.S. crop outlook.

Wheat was unchanged as a flood of cheap grain from Russia continued to dominate the market, keeping prices close to last month’s three-year low.

Corn futures rose slightly.

Chicago soybeans, wheat drop as focus shifts to USDA report

The Rosario grains exchange said Argentina’s soybean harvest could reach 50 million metric tons, having earlier predicted 48 million tons.

Argentine production adds to an estimated 154.6 million ton harvest in Brazil, the largest ever. Brazil is the world’s biggest soybean exporter and expects an even bigger crop next year.

Shipments from South America are challenging U.S. exports, said Arlan Suderman, an analyst at brokerage StoneX.

“Brazil saw a bin-buster this past year … soybean shipments from Brazil are slowing, but they’re still above levels typically seen this time of year,” he said.

The most-active soybean contract on the Chicago Board of Trade (CBOT) was up 0.3% at $12.56-1/2 a bushel by 0454 GMT.

Wheat was flat at $5.56-1/4 a bushel and corn rose 0.1% to $4.88-1/2 a bushel.

CBOT soybeans have fallen around 11% since late August and on both Wednesday and Thursday touched $12.51 a bushel, its lowest since December 2021.

In the U.S., the No. 2 soybean exporter, analysts expect the U.S. Department of Agriculture in its Agricultural Supply and Demand Estimates (WASDE) report on Thursday to trim forecasts for U.S. soybean and corn production and yields.

In a sign of demand that failed to lift prices, the USDA on Wednesday reported U.S. export sales of 121,000 tons of soybeans to buyers in China and 213,000 tons to unknown buyers.

For wheat, the Rosario grains exchange revised its forecast for Argentina’s 2023/24 harvest to 14.3 million tons from 15 million tons after dry weather hit crops.

However, reports from traders that Egypt bought around 480,000 tons of Russian wheat on Tuesday have kept market focus on Russia’s huge wheat surplus and exports, which have driven prices lower.

“There was some talk of Russian FOB values being offered out at $225-$229 (a ton), which would be below the perceived price floor of $240 and thus a bearish factor for flat price,” StoneX analysts wrote in a note.

Also pressuring prices are analyst expectations that the USDA will on Thursday peg U.S. wheat ending stocks at 0.647 billion bushels, up from its 0.615 billion bushel projection in September.

Commodity funds were net sellers of Chicago soybeans, soyoil and wheat on Wednesday and net buyers of corn, traders said.