U.S. agricultural futures fall

By Xu Jing

CHICAGO, Dec. 1 (Xinhua) -- Chicago Board of Trade (CBOT) agricultural futures fell across the board on Tuesday, led by wheat.

The most active corn contract for March delivery fell 5.25 cents, or 1.23 percent, to settle at 4.2075 dollars per bushel. March wheat dropped 7.75 cents, or 1.32 percent, to settle at 5.7725 dollars per bushel. January soybean lost 6.5 cents, or 0.56 percent, to close at 11.62 dollars per bushel.

CBOT agricultural futures dropped on no new export sales and improving weather conditions in Brazil, Chicago-based research company AgResource noted.

U.S. and world wheat futures have been hit by a flood of bearish input this week. Wheat supplies in Australia have increased; Russia has proposed to expand its post-January grain export tariff. All these suggest that competition will dominate wheat cash markets, AgResource noted.

Many in the trade are beginning to reduce their estimate of first-crop corn production in Brazil by 3-5 million metric tons.

Weather forecast shows it is drier in Mato Grosso and Central Argentina but is wetter across Paraguay and Southern Brazil. Brazilian crop health will be stabilized in the near-term but the narrow focus of heavy showers into mid-December is a concern. Little or no rainfall is offered to Cordoba and Buenos Aires in Argentina.

With peak La Nina still two weeks away, a shift to needed rainfall in Argentina is unlikely, AgResource noted. Unusual drought in Mato Grosso and the return of dryness across Northeast Brazil are also worrisome. Brazil no longer has corn and soybean stocks to draw from, which will heighten the market's sensitivity to growing conditions in South America.

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