By Paulo Trevisani

--Corn for July delivery rose 2.8%, to $6.09 a bushel, on the Chicago Board of Trade on Friday, as forecasts of dry weather fueled expectations of lower supplies.

--Soybeans for July delivery rose 1.7% to $13.52 2/4 a bushel.

--Wheat for July delivery rose 1.4% to $6.19 a bushel.

HIGHLIGHTS

Weather Bounce: Grain futures erased most of the losses seen earlier this week. For corn support came mainly from forecasts of dry weather, RCM's Doug Bergman said in a report. Soybean traders were "less concerned about dryness causing stress right now while a much tighter old crop supply situation is supporting cash markets," he said. "Heavily sold producers can look at bullish option or spread positions to re-establish upside exposure."

Unsurprising Exports: The USDA weekly export sales report broadly met expectations. For the week ended May 25, sales of corn for the current and the next marketing year totaled 499,000 metric tons, soybean sales reached 424,000 tons and wheat registered 256,000 tons for the 2022-2023 season. "USDA Export Sales were good for soybean meal and new-crop wheat," Terry Reilly of Futures International said in a report. Weather remained a source of concern for crops. "Majority of the US Midwest will dry down over the next seven days with temperatures above normal."

INSIGHT

Drought Worry: Weather conditions drove investors' concerns Friday. "The CBOT may chop into the weekend, but if mid-June rain fails to materialize, a sharp rally unfolds next week as yield reductions start to be discussed," AgResource analysts said in a report. They add that the need for rain in the Midwest is immediate. "The EU model maintains a dry flow for another 10-12 days. ARC's worry for a Midwest drought is rising."

Support for Beans: Soybeans get support from "the fact that momentum turned higher after yesterday's rally and...the strength in the financial markets," Summit's Tom Pfitzenmaier said in a report. He said that "the weather forecast for the next 30 days may not be quite as impactful for soybeans as it is for corn, but funds have plenty of fire power and if they turn back to buyers, there is plenty of upside potential for the soy complex." Pfitzenmaier added that, "If rain does show up soon, this crop is off to a great start."

AHEAD

--The USDA will release its weekly grains export inspections report at 11 a.m. ET Monday.

--The USDA will release its weekly crop progress report at 4 p.m. ET Monday.

--The EIA will release its weekly ethanol production and stocks report at 10:30 a.m. ET Wednesday.

--The USDA will release its weekly export sales report at 8:30 a.m. ET Thursday.

--The USDA will release its monthly world supply and demand report at noon ET Friday.

--The CFTC will release its weekly Commitment of Traders report at 3:30 p.m. ET Friday.

Write to Paulo Trevisani at paulo.trevisani@wsj.com

(END) Dow Jones Newswires

June 02, 2023 15:29 ET (19:29 GMT)