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GRAINS-U.S. wheat, corn, soy fall as USDA crops report nears

Mark Weinraub
Tuesday, 5 Nov 2013 | 3:22 PM ET

* Corn hits fresh three-year low

* U.S. harvest advancing rapidly, weighs on corn, soy

* Market eyes USDA world supply/demand report due Friday

(Updates with closing prices)

CHICAGO, Nov 5 (Reuters) - U.S. wheat futures fell 1 percent to their lowest in nearly six weeks on Tuesday due to improving crop prospects in the U.S. Plains and declining demand on the export market, traders said.

Soybeans and corn also fell, with corn charting a fresh three-year low and soybeans notching their lowest since February 2012. Expectations that an upcoming U.S. government report will show huge U.S. production of corn and soybeans weighed on both commodities.

Wheat, which has fallen in four of the last five sessions, was the leader on the downside.

"Planting on wheat is starting to wind down. There have been no hitches or glitches," said Dewey Strickler, president of Ag Watch Market Advisors. "Also, the pace of exports in wheat for about the past three, four or five weeks has been on the ropes."

Trading volume was thin across the ag markets as many traders were waiting for the U.S. Agriculture Department's monthly supply and demand reports, due on Friday, before staking out new positions.

"The grains are just biding time at this point," Matt Zeller, director of marketing information at INTL FCStone, said in a note to clients.

Chicago Board of Trade December soft red winter wheat futures were down 6-3/4 cents at $6.56 a bushel. The session low of $6.55 was the lowest for the front-month wheat contract since Sept. 24.

USDA said on Monday that 91 percent of the wheat crop was planted as of Nov. 3 and that good-to-excellent ratings rose to 63 percent from 61 percent a week earlier. A year ago, only 39 percent of the crop was rated good to excellent.

CBOT December corn dropped 1-1/4 cents to $4.25. The session low of $4.24 was the weakest price since Sept 1, 2010.

"Corn is still seeing negative momentum because of the large U.S. harvest coming in, but we are seeing some support from bargain buying as the lows were touched," said Ole Hansen, head of commodity strategy at Saxo Bank. "The negative momentum in corn has been slowing a little. It seems the selling conviction is drying out a bit."

CBOT January soybeans were down 6-1/4 cents at $12.50-1/4 a bushel. The expiring November contract was down 4-3/4 cents at $12.59-1/4 a bushel. The front-month contract's low was the weakest since Feb. 24, 2012.

The harvest of the U.S. corn and soybean crops is nearing completion and is ahead of schedule after a slow start, a weekly USDA report said on Monday.

"U.S. farmers have taken advantage of good weather in the last couple of weeks," said Luke Mathews, commodities strategist at Commonwealth Bank of Australia. "What we are also seeing is very good yield results continuing to come through, which signals that the USDA is likely to revise higher its U.S. corn production estimates."

Prices at 2:08 p.m. CST (2008 GMT)

LAST NET PCT YTD

CHG CHG CHG

CBOT corn 425.00 -1.25 -0.3% -39.1% CBOT soy 1259.25 -4.75 -0.4% -11.2% CBOT meal 392.80 -4.10 -1.0% -6.6% CBOT soyoil 41.15 -0.10 -0.2% -16.3% CBOT wheat 656.00 -6.75 -1.0% -15.7% CBOT rice 1535.50 12.50 0.8% 3.3% EU wheat 202.00 -2.50 -1.2% -19.3% US crude 93.45 -1.17 -1.2% 1.8% Dow Jones 15,643 4 0.0% 19.4% Gold 1310.66 -3.70 -0.3% -21.7% Euro/dollar 1.3473 -0.004 -0.3% 2.1% Dollar Index 80.7080 0.1550 0.2% 1.2% Baltic Freight 1600 48 3.1% 128.9%

In U.S. cents, benchmark contracts, except EU wheat (euros) and soymeal (dollars). CBOT wheat, corn and soybeans per bushel, rice per hundredweight, soymeal per ton and soyoil per lb.

(Additional reporting by Michael Hogan in Hamburg and Naveen Thukral in Singapore; Editing by John Wallace)