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GRAINS-Corn, wheat dip on Goldman, favourable weather worries

Published 04/19/2010, 08:47 AM
Updated 04/19/2010, 09:04 AM
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* Corn, wheat, soy fall as Goldman news pressures

* Near-perfect weather to aid U.S. corn plantings

* China '09/10 soyoil imports seen down 40 percent on year

* Europe also down on Chicago, oil dip, volcanic cloud

(Updates oil, dollar, wheat, Europe)

By Naveen Thukral and Marie Maitre

SINGAPORE/PARIS, April 19 (Reuters) - U.S. corn futures fell nearly 2 percent on Monday, while wheat and soy slipped about 1 percent as fears about the fallout of fraud charges against Goldman Sachs hit investor appetite for riskier assets.

Forecasts for near-perfect spring weather likely to aid plantings in the U.S. Midwest this week also weighed on corn, prompting more investors to book their profits after the Chicago Board of Trade spot corn gained 5.3 percent last week.

Worries about the impact of fraud charges against Goldman Sachs, pressed by the U.S. Securities and Exchange Commission over its marketing of a subprime mortgage product, rattled stock and commodity markets, sending investors in search of less speculative assets such as government bonds.

"If the equity market has got to take a lead and really sell off on the Goldman news, you would think something like wheat and soy are going to get caught up just because they have been reasonably strong over the last few weeks," said Scott Briggs, agricultural commodity strategist with ANZ in Melbourne.

"Fundamentally, wheat and soy should be selling off a little bit further," he added. CBOT soybean contract rose 3.5 percent last week while CBOT wheat closed up 5 percent.

Chicago Board of Trade May wheat fell 0.6 percent to $4.87-1/2 a bushel by 1200 GMT and corn for May delivery lost 1.7 percent to $3.58 a bushel, while May soy was down 0.9 percent at $9.76-1/2 a bushel. ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ For a graphic of the technical outlook, click: http://graphics.thomsonreuters.com/gfx/WT_20101904125742.jpg ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^

Also weighing on Chicago futures was a firmer dollar that traditionally makes U.S. commodities less attractive as a hedge against inflation, and a slide in oil prices to three-week trough in the wake of news on Goldman Sachs.

Oil often drives the prices of grains, because of their use in making alternative fuels when crude becomes pricier.

The weather in the U.S. Midwest is forecast to remain dry in the coming days, allowing farmers to undertake corn plantings, while rains towards the end of the week will improve soil moisture, a forecaster said.

"Dry weather last week and through the first half of this week favours spring fieldwork and corn planting," said Mike Palmerino, a forecaster at Telvent-DTN Weather. "Rain during the second half of the week will improve topsoil moisture for corn germination in areas where soils have dried out. This should be a nearly ideal spring pattern at this time."

Traders also took note of news that China's soyoil imports in 2009/2010 could fall by nearly 40 percent to 1.5 million tonnes due to the delay of Argentina cargoes, according to an estimate by the China National Grain and Oils Information Centre.

On the wheat front, dry weather forecast for most of Australia's grain-growing regions this week may deny farmers a planting window for winter crops such as wheat, with more rain needed before they can go ahead with early plantings.

Australia is the world's fourth largest wheat exporter.

Meanwhile, Russia is in talks to sell 100,000 tonnes of grain and flour to Nicaragua, Sergei Levin, the chief executive of the state-run United Grain Company said on Monday, amid more signs that Europe and Russia were exporting to markets that traditionally buy U.S. grains.

In Europe, Paris May milling wheat was down 0.25 euros to 129.25 euros a tonne, driven by the same factors that affected Chicago plus worries about the economic fallout of the volcanic cloud halting flights across Europe.

* Prices as of 1227 GMT Product Last Change Percent Move End 2009 Ytd Percent Paris wheat 129.25 -0.25 -0.19 131.25 -1.52 London wheat 99.50 0.50 +0.51 106.50 -6.57 Paris maize 142.50 0.00 +0.00 135.00 5.56 Paris rapeseed 308.75 -0.25 -0.08 287.50 7.39 CBOT wheat 487.50 -3.00 -0.61 541.50 -9.97 CBOT corn 357.75 -6.25 -1.72 414.50 -13.69 CBOT soybeans 977.75 -7.50 -0.76 1039.75 -5.96 CBOT rice 12.76 -0.05 -0.35 14.57 -12.42 Crude oil 81.03 -2.21 -2.65 79.36 2.10 Euro/dlr 1.34 -0.09 -6.33 1.43 -6.29 *Front month contracts. CBOT contracts in cents per bushel except rice which is in dollars per hundredweight. Paris wheat in euros a tonne and London wheat in pounds per tonne

(Additional reporting by Nigel Hunt in London; Editing by James Jukwey)

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