GRAINS-Wheat falls on weak demand, falling Russian prices

Credit: REUTERS/ALEXEY MALGAVKO

Adds analyst comment, updates prices

CANBERRA, Feb 1 (Reuters) - Chicago wheat futures moved lower on Thursday amid weak demand and falling export prices in Russia, while soybeans and corn also lost ground and were just above multi-year lows on the prospect of ample supply.

The most-active what contract on the Chicago Board of Trade (CBOT) Wv1 was down 0.3% at $5.93-1/4 a bushel by 0337 GMT. Prices fell 5.2% in January and aren't far from a three-year low of $5.40 reached last September.

CBOT soybeans Sv1 fell 0.2% to $12.19-3/4 a bushel and were close to Tuesday's two-year low of $11.88, while corn Cv1 slipped 0.3% to $4.47 a bushel and was near a three-year low of $4.37 hit twice during January.

"Grain prices are likely to remain under pressure, as markets globally and locally battle with a supply outlook for 2024 that is more plentiful than in past years," said Stefan Vogel at Rabobank in Sydney.

"For a significant 2024 price upside for grain, the world would need to see weather-related supply shortages arise."

Falling wheat prices in Russia, which still has a large surplus to shift before this summer's harvest, have kept the wheat market's focus on Black Sea supplies.

Russia's agriculture minister, meanwhile, said the country would increase the area for the 2024 harvest by 300,000 hectares to 84.5 million hectares, bolstering expectations for another bumper crop.

Euronext wheat futures hit new contract lows on Wednesday.

Data showing a fourth consecutive monthly decline in China's manufacturing activity did nothing to ease concerns about Chinese demand for agricultural imports. O/R

The U.S. dollar also strengthened during January, making U.S. farm products less attractive to importers. UDS=FRX/

Commodity funds - which hold net short positions in CBOT wheat, corn and soybeans - were net sellers of wheat and corn futures on Wednesday while buying soybeans, traders said.

Argentina's farm regions are bracing for a heat wave over the next week, followed by rains that will douse the northern, western and southern regions but largely miss the center-east zone, the Buenos Aires grains exchange said.

India's major wheat-growing areas in the north could experience above normal temperatures in February, the country's weather office said, raising concerns about crop yields.

Ukraine's agricultural maritime exports are expected to fall to around 3.8 million metric tons in January from around 6.1 million tons in the prior month, brokers said.

The European Commission proposed measures to limit agricultural imports from Ukraine and offer greater flexibility on rules for fallow land in a bid to quell protests by angry farmers in France and other EU members.

(Reporting by Peter Hobson; Editing by Sherry Jacob-Phillips and Rashmi Aich)

((peter.hobson@thomsonreuters.com;))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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