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GRAINS-Wheat eases for 2nd session as USDA forecasts higher output

SINGAPORE, June 12 (Reuters) - Chicago wheat futures slid for a second session on Monday, giving up some of last week's gains as the U.S. government forecast higher production. Corn and soybeans lost ground on profit-taking although concerns about crop-damaging hot and dry weather in the U.S. Midwest continued to underpin both markets.

FUNDAMENTALS

* U.S. wheat supplies will be bigger than expected despite a snowstorm in early May that analysts worried had severely damaged the crop in Kansas, the top- producing state, the U.S. Department of Agriculture said on Friday.

* The agency boosted its forecast for U.S. winter wheat production to 1.250 billion bushels from 1.246 billion, and raised its yield projection in Kansas by 2 bushels per acre (bpa) to 44.0 bpa.

* The wheat market jumped almost 4 percent last week with support from lower protein in U.S. wheat due to adverse weather.

* Prospects for low protein in the U.S. harvest of hard red winter wheat have magnified the importance of spring wheat, a high-protein variety prized by millers for its quality.

* For corn and soybeans, U.S. Midwest weather will take center stage this week. Meteorologists predicted highs above 90 degrees Fahrenheit (32 Celsius) across much of the Midwest early this week.

* The USDA on Friday said U.S. soybean and corn ending stocks for the 2016/17 and 2017/18 crop years would be larger than analysts were expecting on average.

* Large speculators trimmed their net short position in Chicago Board of Trade corn futures in the week to June 6, regulatory data released on Friday showed.

* The Commodity Futures Trading Commission's weekly commitments of traders report also showed that noncommercial traders, a category that includes hedge funds, trimmed their net short position in CBOT wheat and increased their net short position in soybeans.

MARKET NEWS

* Asian stocks edged lower early on Monday following a slide by U.S. technology shares and the dollar rose ahead of this week's U.S. Federal Reserve policy meeting, with markets hoping for more guidance on the central bank's interest rate path.

DATA AHEAD (GMT)

- 0800 Italy Industrial output Apr - 1800 U.S. Federal budget May

- Monday, June 12, is a public holiday in Australia, Malaysia and the Philippines.

Grains prices at 0044 GMT

Contract Last Change Pct chg Two-day chg MA 30 RSI CBOT wheat 442.00 -3.75 -0.84% -1.61% 435.68 57 CBOT corn 386.00 -1.75 -0.45% +0.06% 372.99 69 CBOT soy 941.00 -0.50 -0.05% +0.32% 949.76 59 CBOT rice 11.30 -$0.03 -0.22% +0.58% $10.69 72 WTI crude 46.07 $0.24 +0.52% +0.94% $48.09 33

Currencies

Euro/dlr $1.121 $0.001 +0.12% -0.06% USD/AUD 0.7531 0.000 +0.07% -0.15%

Most active contracts Wheat, corn and soy US cents/bushel. Rice: USD per hundredweight RSI 14, exponential

(Reporting by Naveen Thukral; Editing by Joseph Radford)