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GRAINS-Soy, corn rise on smaller U.S. harvest, Argentina drought worries

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U.S. soybean futures climbed for a third straight day on Friday and corn scaled to a 1-1/2 week top on follow-through buying after bullish U.S. Department of Agriculture (USDA) crop data the prior day and concerns about poor South American weather.

Both markets have gained more than 2% since the USDA unexpectedly cut its 2022 U.S. harvest estimates in a monthly report on Thursday and forecast tighter supplies than traders had expected.

Traders also focused on adverse crop weather in South America and squared positions ahead of a three-day weekend, with U.S. markets closed on Monday for the Martin Luther King Jr. Day holiday.

“It’s a little bit of follow-through buying from yesterday and it’s a little bit of positioning ahead of the long weekend,” said Craig Turner, a grain broker with StoneX.

“I’m not sure you want to be short corn and soybeans heading into a long weekend during a weather market in South America.”

Rain is expected in some areas of Argentina over the next two weeks, but a large share of its corn and soybean crops will remain stressed by the country’s worst drought in 60 years, forecasters said.

Chicago Board of Trade March soybeans SH3 were up 7-1/2 cents at $15.26 a bushel at 12:30 p.m. CST (1830 GMT), on pace for a 2% weekly advance. March corn CH3 added 3 cents to $6.74 a bushel, eyeing a 3% weekly gain which would its strongest in 4-1/2 months.

Wheat futures were mixed as traders weighed the USDA’s larger-than-expected winter wheat plantings estimate in Thursday’s reports against tighter supplies and poor crop conditions in the U.S. Plains farm belt.

CBOT March wheat WH3 was up 1-1/4 cents at $7.44 a bushel, near unchanged for the week.

Source : Nasdaq