GRAINS-Chicago soybeans dip as traders track Sino-US trade talks, rising competition from Brazil

BEIJING, May 6 (Reuters) - Chicago soybean futures fell Tuesday, as traders assessed U.S.-China trade talks and rising competition from Brazil, while concerns over U.S. President Donald Trump's proposed EPA funding cuts, which could hit biofuel demand, also weighed on sentiment.

Wheat declined for a second straight session, while corn edged higher after three days of losses.

FUNDAMENTALS

The most-active soybean contract on the Chicago Board of Trade (CBOT) Sv1 slipped 0.29% to $10.43 a bushel, as of 0046 GMT. Wheat Wv1 eased 0.24% to $5.30 a bushel while corn Cv1 inched up 0.17% to $4.55 a bushel.

Traders are positioning ahead of the U.S. Department of Agriculture's (USDA) May supply and demand report due next Monday, which is expected to show steady wheat stocks, a slight increase in corn, and a modest decline in soybeans, analysts said.

Markets are also watching for signs of a thaw in U.S.-China trade tensions. China's commerce ministry said on Friday it is "evaluating" a U.S. offer to hold talks on tariffs imposed during the Trump administration.

Meanwhile, the U.S. soybean market continues to face weak demand from China, the world's top importer, and growing export competition from Brazil, the leading global supplier.

In Brazil, crop consultancy Celeres raised its 2024/25 total corn production forecast to 135.4 million metric tons, up from 134.6 million tons.

The USDA weekly crop progress report showed 51% of the U.S. winter wheat crop rated in good-to-excellent condition, up 2 percentage points from last week and the highest for this time of year since 2020.

U.S. President Donald Trump's proposed cuts to Environmental Protection Agency (EPA) funding have also rattled traders, who worry a funding decrease would reduce demand for biofuels produced with soy and other vegetable oils.

U.S. corn planting was 40% complete as of Sunday, ahead of the five-year average of 39% but slightly below analysts' expectations of 41%.

U.S. soybean planting reached 30%, ahead of the five-year average of 23% but just short of the 31% analysts had forecast.

Commodity funds were net sellers of Chicago Board of Trade corn, soybean, wheat, soyoil and soymeal futures contracts on Monday, traders said. COMFUND/CBT

MARKET NEWS

The U.S. dollar weakened against major currencies, including the yen and the euro, on Monday as markets weighed continued uncertainty from President Donald Trump's tariff policies and their impact on the economy. MKTS/GLOB

DATA/EVENTS (GMT)

0145 China Caixin Services PMI Apr

0750 France HCOB - Services, Composite PMI Apr

0755 Germany HCOB Services, Composite Final PMI Apr

0800 EU HCOB Services, Composite Final PMI Apr

0830 UK S&P GLOBAL PMI: COMPOSITE - OUTPUT Apr

0830 UK Reserve Assets Total Apr

1230 US International Trade $