April 27, 2020 / 1:50 AM / a month ago

GRAINS-Wheat drops for 2nd session on upbeat European crop prospects

SINGAPORE, April 27 (Reuters) - Chicago wheat futures slid for a second session on Monday to their lowest since April 17 as expectations for rains in Europe boosted supply outlook.

Corn lost more ground due to lack of demand for oil-substitute ethanol, made from the grain, amid the coronavirus outbreak.

FUNDAMENTALS

* The most-active wheat contract on the Chicago Board Of Trade lost 0.3% to $5.28-1/2 a bushel by 0121 GMT, having dropped to April 17 low of $5.26-1/2 a bushel earlier in the session.

* Corn fell 0.5% to $3.21-1/4 a bushel and soybeans were down 0.2% at $8.38 a bushel.

* Wheat futures faced pressure from forecasts for rain in key production areas of Europe. A slowdown in demand due to the coronavirus outbreak piled pressure on prices.

* Still, losses were limited after Russia, the world’s top exporter, said it would curb exports.

* Russia will suspend grain exports until July 1 only after the grain it has declared in its second-quarter quota has been shipped, the agriculture ministry said on Sunday.

* Russia previously set the quota for grain exports of 7 million tonnes for April through June following the outbreak of the new coronavirus. This online grain export quota ran out on Sunday, data from the ministry showed.

* A collapse in ethanol demand linked to the pandemic continued to drag down the corn market and forecasts for some good planting weather in the U.S. Midwest added pressure.

* Archer Daniels Midland Co said on Thursday it will temporarily idle ethanol production at two of its corn dry mill facilities due to lower gasoline demand.

* China agreed to buy 136,000 tonnes of U.S. soybeans, the U.S. Agriculture Department said on Friday morning, the third straight day an export deal with the world’s top soy importer was announced.

* Chinese buyers have booked 606,000 tonnes of U.S. soybeans this week - all for delivery in the 2019/20 marketing year - as futures prices fell to an 11-month low due to fallout from the pandemic.

* However, there was still caution given relatively modest purchases since the signing of a U.S.-Chinese trade deal earlier this year, when Beijing pledged to ramp up agricultural imports.

* The USDA also said private exporters reported the sale of 125,000 tonnes of soybeans and 589,395 tonnes of corn to Mexico.

MARKET NEWS

* Asian shares inched higher on Monday ahead of a busy week for earnings and central bank meetings, with much chatter the Bank of Japan (BOJ) will announce more stimulus steps.

DATA/EVENTS AHEAD (GMT) 1230 Brazil Current Account March 1230 Brazil Foreign Direct Investment March — Japan Bank of Japan holds monetary policy meeting (Reporting by Naveen Thukral; Editing by Aditya Soni)

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