CHICAGO: US soyabean futures slumped on Friday, pulling back from recent gains, while wheat futures set a seven-week high on short-covering and technical buying.

Despite the decline in soyabeans, that market remained on track for a weekly gain, with dry weather in rival shipper Argentina underpinning prices. Weakness in the US dollar, which makes US farm products more attractive to global buyers, also supported agricultural commodities, traders said.

Argentina, the world’s No. 3 exporter of soyabeans and corn and the No. 1 supplier of soyameal livestock feed, could suffer from reduced harvests due to persistently hot, dry weather, they said.

Worries that Argentina’s drought could reduce global inventories helped lift soyabean futures above $10 a bushel for the first time in seven weeks on Thursday before the market ended flat. Still, such concerns could continue to support prices, analysts said.

More dry weather is expected next week and most of the following week across the major growing areas in Argentina, according to US-based weather forecaster Radiant Solutions.

The most actively traded soyabean contract was down 4-3/4 cents at $9.87-1/2 a bushel by 11:25 a.m. CST (1725 GMT) at the Chicago Board of Trade.

CBOT wheat was up 4 cents at $4.38-1/2 a bushel after touching $4.40-3/4, the highest price for a most-active contract since Dec. 4. Corn futures were flat at $3.55-1/4 a bushel.

Big harvests in Brazil and the United States, the world’s top two soyabean exporters, may offset crop losses in Argentina. Global supplies are also ample, with the US Department of Agriculture projecting world soyabean inventories at the end of the 2017/18 marketing year at an all-time high.

US soyabean export sales of 759,300 tonnes for the week ended on Jan. 18 were below analysts’ estimates of 850,000 to 1.2 million. Corn export sales of 1.5 million tonnes were above expectations of 900,000 to 1.25 million.—Reuters