GRAINS-Soybeans fall to 4-month low as S. American weather improves

(New throughout; updates prices, adds quotes, changes byline, changes dateline from previous SYDNEY/PARIS) CHICAGO, Dec 28 (Reuters) - Chicago soybean futures fell more than 1 percent and neared a four-month low Thursday on improving crop prospects in Brazil that could curb demand for U.S. soy exports, traders said. Corn and wheat futures also declined in thin trade between the Christmas and New Year's Day holidays. Chicago Board of Trade March soybean futures settled down 10-3/4 cents at $9.56-3/4 per bushel after dipping to $9.55, the contract's lowest since Aug. 31. March corn ended down 1-3/4 cents at $3.52 a bushel and March wheat fell 1/4 cent at $4.27-3/4 a bushel. Soybeans declined as traders monitored crop weather in South America. Conditions remained largely favorable in Brazil, the world's biggest soy exporter, while much-needed showers were forecast this weekend in parts of Argentina, the No. 3 producer. "People want to talk up the iffy weather in Argentina. But the bottom line is that Brazilian weather is super. If Argentina does have some losses, it looks like Brazil is going to offset those losses," said Tom Fritz, a partner with EFG Group in Chicago. Brazil's oilseed processors' association, Abiove, last week left its forecast of Brazil's 2017/18 soybean crop unchanged at 109.5 million tonnes, second only to the record-large 2016/17 harvest of 114 million tonnes. Additional pressure on CBOT soy futures stemmed from worries that more stringent quality rules on Chinese soybean imports starting in 2018 could stall U.S. soy sales to the world's largest buyer. Corn futures fell in sympathy with soybeans, halting a six-session climb in the CBOT March corn contract. Wheat was lower but choppy, underpinned by short-covering and ongoing concerns about potential crop losses from cold weather in the U.S. Plains and Midwest that could damage dormant winter wheat crops. Temperatures in the southern Plains could drop below zero degrees Fahrenheit (minus 18 Celsius) early next week, MDA Weather Services meteorologist Don Keeney said. "I do think we will get below zero in a good portion of Kansas, and there will not be much in the way of snow cover ahead of that," Keeney said. Investment funds were holding a near record net short position in U.S. wheat futures and had sizeable net shorts in corn and soybeans, according to regulatory data released last week.

CBOT settlement prices:

Net Pct Volume

Last change change

CBOT wheat WH8 427.75 -0.25 -0.1 30427 CBOT corn CH8 352.00 -1.75 -0.5 86123 CBOT soybeans SH8 956.75 -10.75 -1.1 111037 CBOT soymeal SMH8 316.10 -2.40 -0.8 53813 CBOT soyoil BOH8 32.71 -0.56 -1.7 67376

NOTE: CBOT March wheat, corn and soybeans shown in cents per bushel, soymeal in dollars per short ton and soyoil in cents per lb.

(Additional reporting by Colin Packham in Sydney and Sybille de La Hamaide in Paris; Editing by Kenneth Maxwell and David Evans)