CHICAGO, March 6 (Reuters) - Benchmark Chicago wheat futures tumbled to their lowest point in more than three years on Wednesday as low prices in an Algerian import tender this week highlighted stiff global export competition from Black Sea grain supplies, traders said.
Soybean futures also declined while corn drifted upward in choppy trade. Both markets continue to hover above three-year lows set last week.
Chicago Board of Trade (CBOT) May wheat settled down 20 cents at $5.31 per bushel after dipping to $5.29-1/2, the lowest on a continuous chart of the most-active wheat contract since August 2020.
CBOT May soybeans ended down 3/4 cent at $11.48-1/4 per bushel and May corn finished up 2-1/2 cents at $4.28-3/4 a bushel.
Wheat set the tone after Algeria purchased at least 870,000 metric tons on Tuesday, mostly believed to be cheap wheat produced in the Black Sea region.
"As in Europe, competitive pressure from Black Sea wheat is pushing all U.S. wheat down," consultancy Agritel said.
After the close of the CBOT, Egypt's state wheat buyer set an international wheat purchase tender with offers due on March 7.
"Major importers are still holding out for lower prices," Terry Reilly, senior strategist at Marex, said. Prices may continue to trend downward as Russia tries to offload its glut of old crop to make way for the new harvest, Reilly said.
The grain markets sagged despite a softer dollar and strength in crude oil futures. The dollar slipped to a one-month low against the euro after Federal Reserve Chair Jerome Powell said inflation is not quite tamed, though the U.S. central bank still expects to reduce its benchmark interest rate later this year.
In Europe, May wheat on Euronext fell to a contract low of 188.25 euros that was also a new 3-1/2-year low for a second-month price.
"It's logical for Algeria to buy a lot at these low prices, but it's not really good news for the market because it looks like merchants had a lot to sell," a European trader said.
Traders awaited a monthly supply/demand report due Friday from the U.S. Department of Agriculture for a gauge for South American production. (Reporting by Heather Schlitz; Additional reporting by Gus Trompiz in Paris and Mei Mei Chu in Beijing; Editing by Shailesh Kuber and Richard Chang)
