By Jesse Newman 
 

CHICAGO--Corn futures extended gains Friday, with buying by commodity funds pushing prices for the grain to a more than six-month high. Meanwhile, wheat rose while soybeans fell.

Prices for corn climbed for a sixth straight session as optimism over demand drove a spate of buying by commodity funds. The U.S. Department of Agriculture on Friday said net corn sales for the week ended Jan. 12 totaled almost 1.4 million metric tons, on the high end of analyst expectations for 750,000 to 1.5 million tons.

Still, gains in the market were capped by farmer selling and huge grain reserves in the U.S. and overseas, which are sufficient to satisfy current demand. Uncertainty also lingers over domestic demand for the grain, in part because China recently increased tariffs on imports of U.S. dried distillers' grains, an ethanol by-product used in animal feed, which likely will make more of the ingredient available to domestic livestock producers, who could opt to feed DDGs to animal herds instead of corn.

Corn futures for March delivery advanced 3 1/2 cents, or 1%, to $3.69 3/4 a bushel at the Chicago Board of Trade, the highest closing price since June 29.

Soybean prices dropped for the second consecutive day amid forecasts for drier weather in Argentina, where heavy rains and flooding have spurred speculation that crops could suffer, curbing that country's output. Now, a better weather outlook is dimming prospects for major crop shortfalls there and a simultaneous boost in demand for U.S. supplies.

Farmer selling and profit-taking also weighed on the market, as traders booked profits following a multi-day run up in prices.

CBOT March soybeans delivery declined 2 3/4 cents, or 0.3%, to $10.67 1/2 a bushel.

Wheat prices advanced, bolstered in large part by investor short covering. CBOT March wheat gained 4 3/4 cents, or 1.1%, to $4.28 1/4 a bushel.

Write to Jesse Newman at jesse.newman@wsj.com

(END) Dow Jones Newswires

January 20, 2017 16:59 ET (21:59 GMT)

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