GRAINS-Corn futures up for 3rd session as U.S. planting lags expectations

27 May 2020, 04:00

* Wet weather in U.S. Midwest slows corn, soybean planting pace

* Forecast of lower Brazilian production supports prices (Adds details on Brazilian crop, quote in paragraph 3-4)

By Naveen Thukral

SINGAPORE, May 27 (Reuters) - Chicago corn futures rose for a third session on Wednesday as a slower-than-expected U.S. planting progress and a downgrade to Brazilian production underpinned the market.

Soybeans ticked higher, a day after strong gains on support from Chinese demand.

"There is a bit of support for corn but we don't see U.S. planting delays a very big deal as of now," said one Singapore-based feed grains trader.

"South American exporters are trying to hold prices, we think the market will decline as it is just a matter of time."

Lower demand for corn-based fuel ethanol and demand destruction due to the coronavirus are expected to weigh on grain and oilseed prices.

The most-active corn contract on the Chicago Board Of Trade added 0.3% to $3.20 a bushel by 0345 GMT, having gained 0.7% in the last session.

Soybeans rose 0.1% to $8.47-1/2 a bushel, having closed 1.8% higher on Tuesday, while wheat fell 0.1% to $5.06-1/4 a bushel, after dropping 0.2% in the last session.

The U.S. Department of Agriculture (USDA) said farmers planted 88% of their intended corn acres as of Sunday, below analysts' average estimate of 90%, according to a Reuters poll.

It also said farmers planted 65% of their intended soybean acreage, lagging an average poll estimate of 69%.

Most of the U.S. Crop Watch farmers got an early start to corn and soybean planting this year, but cool, wet conditions have held back growth, and in Indiana, the early start to soybean planting unfortunately did not pay off, Karen Braun, a market analyst for Reuters, wrote in a column.

Brazil's 2019/2020 second-corn output forecast was revised to 71.7 million tonnes, 3 million tonnes lower than predicted on March 31, according to a statement from agribusiness consultancy Agroconsult on Tuesday.

Soybeans on Tuesday drew strength from an announcement by the USDA of fresh export sales to China, which agreed in a trade deal this year to increase purchases of U.S. farm products. (Reporting by Naveen Thukral; Editing by Himani Sarkar)