GRAINS-Soybeans ease from 10-month high as soyoil slides

By Ella Cao

BEIJING/PARIS, May 15 (Reuters) - Chicago soybean futures slipped from near 10-month highs on Thursday, pressured by a sharp drop for soyoil linked in turn to falling crude oil prices and concerns over the U.S. biofuel targets.

The most-active soyoil futures BOcv1 on the Chicago Board of Trade was down 5.7% at 49.32 cents per pound by 1028 GMT, the steepest daily decline since June 2023.

That pushed soybeans Sv1, which are crushed to produce soyoil and soymeal, down 1.3% to $10.63-3/4 per bushel. Soybeans had reached their highest since late July on Wednesday, buoyed by a de-escalation in a U.S.-China trade dispute and optimism about continued U.S. tax credits for biodiesel fuel.

However, concerns over biofuel policy re-emerged since Wednesday, with rumours that a target for renewable diesel volumes under discussion for next year will come well below the 5.25 billion gallons proposed by an alliance of oil and biofuel producers.

"There was a rumour yesterday that the RVO (renewable volume obligation) will be smaller than expected, which is a disappointment," a European trader said.

Weaker crude oil prices, amid growing hopes for a U.S.-Iran nuclear deal that could see U.S. sanctions on Iran lifted, also weighed on soyoil by curbing margins for biofuel.

Optimism over a temporary truce in the U.S.-China trade war, meanwhile, had subsided as analysts warned of uncertainty ahead of the U.S. marketing season.

On Wednesday, agribusiness consultancy AgResource estimated U.S. soybean exports may drop 20% and that prices will plunge if the U.S. and China fail to resolve their trade dispute.

CBOT corn Cv1 ticked down 0.1% to $4.45 per bushel, supported by concerns about potential unfavourable weather during the U.S. summer.

In rival supplier Brazil, 2024-25 corn output is estimated to be about 125 million metric tons, according to the Brazilian Association of Corn and Sorghum Producers.

CBOT wheat Wv1 inched down 0.1% to $5.24-1/2 a bushel as a rebound from a near five-year low earlier this week stalled.

Wheat markets remained curbed by broadly favourable harvest prospects in the Northern Hemisphere.

Consultancy Strategie Grains raised its monthly forecast for this year's European Union soft wheat crop, while in the United States a crop tour in Kansas this week has pointed to above average yields in the country's biggest wheat-producing state.

However, a large purchase by Algeria on Wednesday and an import tender announced by Saudi Arabia on Thursday suggested low prices were stirring some demand.

Traders will get another pointer on export demand later on Thursday from the U.S. Department of Agriculture's weekly export sales report.