New-crop U.S. soybean and corn futures sank on Friday as updated weather forecasts scaled back the threat of hot and dry weather in the Corn Belt and traders took profits following recent gains.
Nearby July contracts expired after gyrating in extremely volatile trading.
At the Chicago Board of Trade, November soybeans, representing the crop that will be harvested in the autumn, settled down 33-1/2 cents at $12.57-1/4 a bushel, after hitting a three-week top of $12.97 (all figures US$).
The lower close followed a four-day rally, leaving the contract with a weekly rise of 2.4 per cent.
"I think you're just seeing people get out of here prior to the weekend," said Jim Gerlach, president of A/C Trading, referring to the profit-taking.
Earlier this week, the markets jumped as some forecasters began warning about the risk of hot and dry weather, especially in the southwestern portion of the Corn Belt.
A lack of rainfall is expected to stress crops into late July in portions of the western U.S. Midwest, said Andy Karst, meteorologist for World Weather Inc. However, a lack of extreme heat will cushion the blow on crops, he said.
Updated midday forecasting models, including the closely watched Global Forecast System (GFS) released by the U.S. National Weather Service, looked more crop-friendly.
"The GFS went overboard on being very wet, including in the southwestern Corn Belt. The 11-15 day (period) was cooler also. That got some attention," said Dan Cekander, analyst with Newedge USA in Chicago.
CBOT December corn ended down 17-3/4 cents at $5.09-1/4 a bushel but posted a weekly gain of 3.7 per cent.
The absence of a threat from high temperatures is "making it difficult for the market to continue with its apparent weather scare rally," said Anne Frick, senior oilseeds analyst for Jefferies Bache.
Trading was volatile in nearby contracts ahead of the expiration of front-month July futures at 12:01 p.m. CT.
July soybeans traded in a massive 75-cent range, from $15.34-1/2 to $16.10, before settling at $15.63-1/4.
And a single 5,000-bushel contract of July corn traded at $8 a bushel, the highest spot corn price in 10 months, before the contract settled at $7.01-1/2.
Massive corn sale
Traders shrugged off the announcement of the eighth-largest sale of U.S. corn on USDA records. Private exporters reported the sale of 960,000 tonnes of U.S. corn to China for delivery during the new marketing year, according to the U.S. Department of Agriculture.
Rumours of the sales helped boost prices earlier in the week, and some traders sold on confirmation of the business from the USDA, according to analysts.
Reuters reported on Thursday that China's Sinograin bought more than one million tonnes of U.S. new-crop corn for shipment in the 2013-14 year.
The purchase follows huge wheat imports earlier this month when Sinograin bought more than 1.3 million tonnes of U.S. wheat after the domestic wheat harvest had been damaged by bad weather.
USDA, in a monthly supply/demand report on Thursday, forecast China's wheat imports at 8.5 million tonnes in 2013-14, up five million tonnes on the month and up from 3.2 million in 2012-13.
The department lowered its forecast for 2013-14 U.S. wheat ending stocks to 576 million bushels from its June projection of 659 million and below the average analyst estimate of 632 million.
However, CBOT wheat ended lower on Friday, halting a four-day rise as corn and soybeans tumbled.
July wheat settled down 3-3/4 cents at $6.75-1/2 per bushel, while most-active September wheat ended down two cents at $6.81.
-- Tom Polansek and Julie Ingwersen
report for Reuters from Chicago. Additional reporting for Reuters by Nigel Hunt in London, Naveen Thukral in Singapore and Michael Hogan in Hamburg.