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Expectations of record crop hang over soybean market

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China demand worries offset strong weekly exports, softer

dollar

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Next week's U.S. Midwest crop tour eyed for corn, soy

yields

(Updates paragraph 1, adds market closing prices, updates

headline)

By Heather Schlitz

CHICAGO, Aug 16 (Reuters) - Chicago Board of Trade

soybeans and corn futures turned lower on Friday, with both also

notching a third weekly loss, as farmers kept clearing out their

grain bins ahead of a U.S. harvest that is forecast to see

massive yields, traders said.

Wheat futures firmed as problems with the French and German

wheat crop, plagued by excess harvest-time rain, supported

prices.

Most-active CBOT wheat settled up 1-3/4 cents to $5.30

a bushel, while corn ended down 4-1/2 cents at $3.92-1/2 a

bushel.

Meanwhile, most-active soybean futures fell down

11-1/2 cents to finish at $9.57 a bushel - having dipped at one

point to $9.55 a bushel, the lowest since Sept. 2, 2020.

U.S. wheat futures have continued to face pressure from

a strong Black Sea wheat crop. However, the French soft wheat

crop, which is expected to be the smallest since the 1980s, and

a declining German crop have provided a floor under prices.

All three crops were trading close to their lowest since

2020 against a backdrop of large U.S. supplies and stiff

competition from Brazil and Russia to capture limited demand.

Farmers have been selling off huge volumes of old crop

corn and soybeans to generate much-needed cash flow ahead of the

fall, when property taxes, crop insurance and other bills come

due, traders said. Meanwhile, funds continue to hold large short

positions on U.S. commodities, leaving the market open to short

covering.

"It's a perfect storm for funds," Darin Fessler, trader

at Lakefront Futures and Options, said. "They're thinking about

getting out of their massive shorts while producers are

selling."

Renewed concern about China's economy and weak Chinese

demand for U.S. soy also weighed over U.S. soy futures, traders

said.

"The Chinese economy isn't exactly hunky dory," Fessler

said. "Demand hasn't been great, and it's putting further

pressure on U.S. prices even though U.S. beans are cheap."