Soybean futures fell for a third straight day on Friday and snapped a five-week winning streak, as investors banked profits and recent rains in the farm belt looked set to help some of the crop recover from the worst drought in half a century.
A lower-than-expected U.S. production forecast from closely-followed analytical firm Informa Economics lifted soybeans from early lows, but the market slipped as investors squared positions ahead of the weekend and ahead of next week's monthly government supply-demand report.
"It appears that the weather we had in the last part of August was beneficial for the soybean crop so some people are taking some money off the table today," said Karl Setzer, market analyst with MaxYield Co-operative.
Wheat jumped 1.5 per-cent on concerns about thinning global supplies due to adverse weather in key exporting nations, including Russia and Australia. The dollar's one per cent drop after a weaker-than-anticipated jobs report offered further support. A weaker dollar makes U.S. exports more competitive in the world market.
Corn inched higher on spillover support from wheat, but remained bound in a recent trading range as investors awaited next week's U.S. Agriculture Department report which was expected to show a sharply reduced U.S. crop.
Chicago Board of Trade (CBOT) new-crop November soybeans fell 10-1/2 cents, or 0.6 per cent, to $17.36-1/2 a bushel (all figures US$). The benchmark contract declined 1.1 per cent this week after five straight weeks of gains.
Commodity funds sold an estimated net 5,000 soybean contracts on the day, trade sources said.
Earlier in the day, the market bounced after Informa cut its U.S. soy crop forecast by five per cent to 2.639 billion bushels in a mid-morning report -- a deeper cut than many had expected.
Private analysts on average expected USDA to trim its crop forecast next Wednesday to 2.657 billion bushels from 2.692 billion in August, although some expected a slight increase because of rains in recent weeks across northern and eastern Midwest.
Wheat futures jumped for a second straight day in the strongest two-day rally since mid-July on continued concerns about weather-reduced global supplies and possible export curbs from major suppliers in the Black Sea region.
Dry weather in key production areas of Australia, the world's No. 2 exporter, and a dry pattern in the southern U.S. Plains wheat belt ahead of autumn planting added support.
CBOT December wheat rose 13-1/4 cents, or 1.5 per cent, to $9.05/bu. Climbing for a second straight week, the 1.7 per cent weekly gain was the strongest in eight weeks.
Commodity funds bought a net 3,000 wheat contracts on the day, trade sources estimated.
Corn futures rose modestly, supported by expectations for another deep cut by the USDA to its production forecast next week, although prices remained in a recent narrow range near $8/bu.
Analysts on average expected the government to reduce its corn production forecast to 10.380 billion bushels, down 3.7 per cent from its August forecast and the lowest in nine years.
New-crop CBOT December corn added one cent to settle at $7.99-1/2 a bushel, essentially unchanged from a week ago.
-- Karl Plume writes from Chicago for Reuters. Additional reporting for Reuters by Gus Trompiz in Paris and Naveen Thukral in Singapore.