Meanwhile, soybean futures advanced amid indications of strong demand for U.S. supplies, while corn prices edged higher as traders continued to monitor drought-stricken crop conditions in the U.S.
Escalating concerns over the impact of scorching heat and dry weather in the U.S. Midwest and Great Plains-region fuelled a furious rally in grain prices over the past two months.
Conditions of U.S. corn and soybean crops remained at the lowest level since 1988 for this time of year, according to weekly crop progress data from the U.S. Department of Agriculture released earlier in the week.
However, futures have been under pressure in recent sessions as market players sold positions to lock in gains amid concerns high prices may be hurting global demand for U.S. supplies.
Meanwhile, updated weather models Friday predicted beneficial rains in the drought-stricken U.S. Midwest crop region later in the week, before dry weather conditions return to the area.
On the Chicago Mercantile Exchange, corn futures for September delivery settled at USD7.9912 a bushel by close of trade on Friday. Earlier in the day, front-month prices hit a one-week high of USD8.0438 a bushel.
Despite Friday’s modest gains, the September corn contract dipped a modest 0.2% on the week.
Corn prices rallied to an all-time high of USD8.4238 a bushel on August 10 amid ongoing concerns over drought conditions in the U.S. Midwest and Great Plains-region.
But prices have been under pressure in recent sessions after the USDA last week cut its estimates of overall demand for U.S. corn by 12% from a month earlier, due to higher prices.
U.S. corn export sales last week totaled 253,400 tonnes, below the range of trade forecasts for sales of 350,000 to 550,000 tonnes.
The U.S. produced 38% of the world's corn last year, making it the both world's largest corn producing nation and the largest exporter of the grain.
Elsewhere on the Chicago Board of Trade, soybeans for September delivery settled at USD16.7150 a bushel by close of trade Friday. Earlier in the day, the front-month contract hit a session high of USD16.7238 a bushel.
On the week, September soy prices eased 0.15%.
Soybeans added nearly 1% Friday, after the USDA confirmed a sale of 706,100 tonnes of U.S. soybeans to China, the largest purchase of the oilseed by the Asian nation since June. China is the world’s largest soybean consumer.
Total U.S. soy exports came in at 1.02 million tonnes last week, the highest amount in six-weeks and above market expectations for sales of 950,000 tonnes.
Soy futures have gained sharply in recent weeks, as the same hot, dry weather that boosted corn buoyed soy futures as well. Soybeans are grown in many of the same regions across the U.S. as corn.
But prices have been weighed in recent sessions as stressed crops in the U.S. Great Plains and Midwest region received some relief with light rains over the past few days.
Meanwhile, wheat for September delivery settled at USD8.7388 a bushel by close of trade on Friday. Earlier in the day, prices hit a four-day high of USD8.7975 a bushel.
Despite a gain of 1.4% on Friday, the September wheat contract still declined 1.45% on the week.
Wheat futures rose for a third straight session on Friday, boosted by concerns over tightening supplies from Russia after influential Russian industry group SovEcon said Russia's exportable grain surplus of 10 million to 11 million tonnes could run out by November if the country retains a high pace of exports.
According to the firm, Russian wheat stocks totaled 10.61 million tonnes as of August 1, down 30% from a year earlier and the lowest since 2003.
The news fuelled fears over the implementation of export limits on Russian grain shipments in the near-term.
On Friday, Russian Agriculture Minister Nikolai Fyodorov ruled out a grain export ban, but he did not exclude "pinpoint interventions" to influence exports.
Mounting fears over dry weather conditions in Western Australia, the largest wheat producing state in Australia, further supported gains.
In the week ahead, grains traders will focus on the USDA’s weekly crop progress report on Monday, as well as Thursday’s weekly exports data.
Market participants were also looking ahead to acreage data from the U.S. Farm Service Agency,
Corn and soybean traders will continue to pay close attention to weather forecasts for the U.S. Midwest and Great Plains-region, while wheat traders will monitor crop conditions in Russia.
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