* Soy shrugs off concerns of any drop in Chinese demand
* Weaker dollar lends support to U.S. grains
* Fears of economic slowdown could weigh on grains
By Mayank Bhardwaj
NEW DELHI, March 23 (Reuters) - Chicago grains rose on
Friday, with soybean prices fuelled by the prospect of drought
in leading producers Brazil and Argentina, while wheat and corn
benefited from robust export numbers.
Chicago Board of Trade soybeans rose 0.9 percent to
$13.61 a bushel by 0444 GMT. Soybeans have fallen in three of
the last four days, setting back from a four session winning
streak last week.
Soybeans shrugged off concerns over any drop in demand from
China, the world's top buyer, which takes nearly two-thirds of
world supply.
"Traders see a good deal of buying opportunity in soybean as
prices dropped last night and that is the reason for soy to edge
up," said Adam Davis, a senior commodity analyst at Merricks
Capital in Melbourne.
For the week, soy is headed for a fall of about one
percent, snapping a run of five weeks of gains, while wheat
and corn were down more than 3 percent.
And grains could face pressure next week, Davis said.
"In some quarters, there is a concern about weakening
Chinese and European economies and the slowdown could impact
corn, wheat and soybean but the extent of the impact remains to
be seen," he added.
The euro zone's economy took an unexpected turn for the
worse in March, hit by a sharp fall in French and German factory
activity.
Data on Thursday showed China's economic momentum slowed in
March as factory activity shrank for a fifth straight month,
leaving investors fretting about the risks to global growth.
Wheat and corn futures jumped on encouraging export sales
data, extending the previous session's gains on strong export
demand for both, with May wheat up 0.5 percent to
$6.49-3/4 a bushel, while corn gained 0.7 percent to
$6.48-3/4 a bushel.
A weaker dollar also lent support, traders said. A weaker
dollar, down 0.08 percent against a basket of currencies,
makes commodities priced in the greenback cheaper for investors
holding other currencies.
Traders keenly watch weekly export data from the United
States Department of Agriculture (USDA) and a rise in overseas
sales by the United States pushes up prices.
A USDA report showed corn export sales at 917,100 tonnes,
the largest in five weeks, against analyst expectations for
sales between 650,000 and 850,000 tonnes. Wheat export sales of
541,300 tonnes topped trade expectations of 400,000 to 500,000
tonnes.
But U.S. soybean export sales missed expectations, falling
to the lowest point in seven weeks.
On Tuesday, oilseeds analyst Oil World cut its 2012 soybean
output forecast for Brazil by 1.5 million tonnes to 66.5 million
tonnes, down 12 percent from 75.3 million last year.
The Hamburg-based agency also reduced its forecast for
Argentina's 2012 crop by 0.5 million tonnes to 46.5 million
tonnes, down 5.5 percent from 49.2 million last year.
