GRAINS-Soybeans ease after rally, U.S. trade, crop condition news awaited

By Michael Hogan

HAMBURG, May 5 (Reuters) - Chicago soybean futures fell on Monday as traders awaited updates on possible U.S.-China trade talks amid mounting competition from Brazil.

Wheat and corn also fell as traders expected positive reports about the condition of U.S. crops and planting progress later on Monday.

Chicago Board of Trade most-active soybeans Sv1 were down 0.7% at $10.50-1/4 a bushel at 1039 GMT. Wheat Wv1 fell 0.5% to $5.40-1/4 a bushel, and corn Cv1 fell 0.6% to $4.66 a bushel.

China is "evaluating" an offer from Washington to hold talks over U.S. tariffs, China's Commerce Ministry said on Friday.

"Soybeans are weakened as news of the next development in the U.S./China trade war is awaited," said Matt Ammermann, StoneX commodity risk manager.

"Are the worst of the trade tensions behind us? Markets are awaiting confirmation this week of actual trade talks between the U.S. and China."

"Meanwhile, forecasts of Brazil’s soybean crop are also being increased." Soybeans are also being weakened by lower soyoil prices, in turn following falling crude oil, he said.

There is also weakness from U.S. President Donald Trump's proposed cuts in federal funding next year for renewable energy projects including the Environmental Protection Agency (EPA), which could reduce demand for biofuels produced with vegetable oils.

The U.S. Department of Agriculture will on Monday publish weekly updates on U.S. planting progress and crop conditions.

"Corn is lower in early trade, with the U.S. Midwest weather looking good for plantings which could mean a positive USDA planting progress report later on Monday," Ammermann said.

"Wheat is also lower with an overall lack of weather risk to U.S. and Black Sea crops. Rain is needed in the Black Sea but some Black Sea crop estimates are also being raised because of lack of frost damage this winter."

Traders noted bearish news of rising Russian wheat exports creating competition for U.S. supplies.