WINNIPEG, Manitoba - Chicago wheat futures rose on Wednesday, as short-covering and a weaker U.S. dollar buoyed prices after a two-day slide, while a U.S. government report weighed on corn.
Corn dipped after the U.S. Department of Agriculture raised its outlook for domestic corn supplies by 25 million bushels, more than analysts were expecting, due to weakening export demand.
Soybeans slipped after the report, on track to extend losses to a third straight session.
Chicago Board Of Trade March wheat dropped 1.2 percent or 5-3/4 cents at $4.87-1/4 a bushel by 11:47 a.m. CST (1747 GMT), even though USDA raised its outlook for world wheat ending stocks above market forecasts due to increased production in Canada and the European Union.
"It's a pretty neutral report. The fact that it didn't come out as bearish as feared is bringing some buying in," said Jack Scoville, vice-president for Price Futures Group in Chicago. "The dollar (index) being down 800 points is helping."
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World ending stocks of wheat were seen at 229.86 million tons, up from 227.30 million tons in November and above analyst estimates that ranged from 224.00 million tons to 228.73 million tons.
March corn fell 0.7 percent or 2-3/4 cents to $3.70-3/4 a bushel, after USDA cut its outlook for U.S. exports and raised its view of U.S. corn use for ethanol.
Corn ending stocks for the 2015/16 marketing year were pegged at 1.785 billion bushels, up from the government's November projection of 1.760 billion. Analysts were expecting corn ending stocks of 1.768 billion bushels, based on the average of estimates in a Reuters poll.
January soybeans dipped 0.6 percent or 5-1/2 cents to $8.71-1/4 a bushel.
Short-covering ahead of the USDA report dried up, putting the focus on stiff global competition for U.S. soybean supplies, with weather improving in South America, said Don Roose, president of U.S. Commodities.
The soybean market had reached a six-week high at the start of the week, supported by brisk export demand from China.
