By Kirk Maltais

--Wheat for December delivery fell 1.3% to $5.70 1/4 a bushel on the Chicago Board of Trade on Thursday after rising 5.2% in the previous session, as world wheat prices stayed stable.

--Soybeans for November delivery were unchanged at $10.23 1/2 a bushel.

--Corn for December delivery rose 1% to $3.82 3/4 a bushel.

HIGHLIGHTS

Open Question: Traders pulled back after Wednesday's rally, with the wheat market questioning what it knows about the Russian crop. The previous session was dominated by speculation about dry weather in Russia. "Wheat will be volatile as the trade is rightfully uncertain how to forecast 2021 Russian production," AgResource said.

Burning Oil: CBOT soybean oil futures took a hit as U.S. crude oil futures fell 3.7% to just under $39 a barrel. A group of 10 investment banks polled by The Wall Street Journal forecast that U.S. benchmark West Texas Intermediate futures would average $50.31 a barrel in the fourth quarter of 2021, below pre-coronavirus levels topping $60 a barrel. Vegetable oil prices tend to move with petroleum, making this negative for the future of soybean oil prices. Soybean oil for December delivery finished 2.1% lower at 32.42 cents a pound.

INSIGHT

Foreign Buying: U.S. export sales of grains exceeded grain traders' expectations across the board, driven largely by sales to China, Mexico and unknown destinations. Wheat sales totaled 506,300 metric tons, corn sales totaled 2.03 million tons, and soybean sales totaled 2.59 million tons, according to data from the USDA released Thursday. "The report was seen supportive all around," said Terry Reilly of Futures International.

Dry as a Bone: Drought concerns in crop-growing areas of South America has grains traders eyeing an opportunity for U.S. exports to increase their market share. "Any weather issues in South America (La Nina) or the U.S. in the spring could send corn into the $4s [per bushel] across the board," said Craig Turner of Daniels Trading. "Add in more demand from China and corn is a very interesting market." Soils are dry in countries such as Brazil and Argentina. If they don't get rain, then large crops expected there will be diminished, leaving room for U.S. crops on the export market.

Supply Chain: Rail shipments of U.S. grains are up from last week and higher than this time last year, according to USDA data. U.S. Class I railroads originated 22,130 grain carloads during the week ended Sept. 19, a 3% increase from the previous week and 16% more than last year, in the weekly grain transportation report released Thursday. Barge shipments of grains are also higher for the week, although are still down for the year, according to the USDA. For U.S. grains, the higher shipments could bolster speculation about rising livestock-feed demand, which could boost grain prices.

AHEAD

--The CFTC releases its weekly commitment of traders report at 3:30 p.m. ET Friday.

--The USDA releases its weekly grain export inspections data at 11 a.m. ET Monday.

--The USDA releases its weekly crop progress report for the 2020/21 crop at 4 p.m. ET Monday.

Write to Kirk Maltais at kirk.maltais@wsj.com

(END) Dow Jones Newswires

October 01, 2020 15:48 ET (19:48 GMT)

Copyright (c) 2020 Dow Jones & Company, Inc.