CANBERRA, Jan 17 (Reuters) - Chicago soybean futures inched higher on Wednesday, although the contract hovered near a two-year low touched last week amid expectations of a bumper harvest in Argentina and weak Chinese demand for imported beans.
Corn futures were flat, with plentiful global supply holding prices near Friday's three-year low, while wheat recovered from a seven-week low hit on Tuesday.
FUNDAMENTALS
* The most-active soybean contract on the Chicago Board of Trade (CBOT) was up 0.1% at $12.29 a bushel by 0107 GMT, having fallen to $12.03 on Friday, its lowest since November 2021.
* CBOT corn was flat at $4.43-1/2 a bushel after hitting $4.41 on Friday, the lowest since December 2020.
* Wheat was up 0.3% at $5.84 a bushel after slipping to $5.77 on Tuesday.
* All three contracts have fallen by between 5% and 7% so far this month amid strong supply, lacklustre demand and a strengthening U.S. dollar, which made U.S. agricultural products less attractive to importers.
* The U.S. government on Friday raised its estimates for U.S. yield and production levels for the recently-ended U.S. soybean harvest, and rain in South America has lifted the supply outlook for soybean and corn crops there.
* Argentina is set for a corn and soy "super harvest", an analyst at the Rosario grains exchange said, adding that production forecasts - currently at 52 million metric tons for soybeans and 59 million tons for corn - would likely continue to rise.
* Harvest estimates in Brazil have also become more optimistic after a dry period ended. However, a grain farmers' association on Tuesday forecast a 135 million metric ton soybean crop in the 2023/2024 cycle, far below the government's expectations of 155 million tons.
* Data on Tuesday showed that the number of U.S. soybeans inspected for export in the week ended Jan. 11 were on the higher end of trade expectations and U.S. soybean processors crushed more soybeans in December than any previous month.
* But U.S. soybean exports have been weak amid a glut of cheap supply from Brazil, and demand from top importer China is expected to slow in the first quarter due to a shrinking pig herd there denting demand for feed.
* Speculators are betting on a price drop for soybeans, corn and wheat, although they were net buyers of soybeans on Tuesday, traders said.
* In wheat markets, top exporter Russia is expecting a 143 million-147 million ton crop in the coming season, the third bumper crop in a row, which should maintain pressure on prices.
* However, cold temperatures may have damaged some winter wheat in the United States and Canada's abnormally dry winter is worsening drought conditions across the western provinces, where most of the country's grain is produced.
* Algeria's state grains agency OAIC has bought about 600,000 metric tons of milling wheat in an international tender that closed on Tuesday, European traders said in initial assessments.
MARKETS NEWS
U.S. stocks retreated on Tuesday while the dollar gathered strength amid warnings that markets might have gotten ahead of themselves with respect to the timing and extent of central bank policy cuts.
(Reporting by Peter Hobson; Editing by Sherry Jacob-Phillips)
