GRAINS-US grains off highs with Fed in focus, soyoil down more than 2%

By Julie Ingwersen

CHICAGO, Sept 17 (Reuters) - Chicago corn and soybean futures sagged on Wednesday, retreating from multi-week highs on profit-taking and an uptick in the dollar, while a drop in soyoil futures added pressure, analysts said.

Wheat futures followed the lower trend, with forecasts for rains in the southern U.S. Plains adding to bearish sentiment.

Chicago Board of Trade December corn CZ25 settled down 2-3/4 cents at $4.26-3/4 per bushel, turning lower after matching Tuesday's two-month high of $4.31-1/4.

CBOT November soybeans SX25 fell 6 cents, or 0.6%, to $10.43-3/4 a bushel, while December soyoil BOZ25 ended down 1.42 cents, or 2.7%, at 51.78 cents per pound.

CBOT December wheat WZ25 settled down 5-3/4 cents at $5.28-1/4 a bushel.

Grain futures dipped as the dollar .DXY firmed ahead of a widely anticipated Federal Reserve interest rate cut. A firmer dollar tends to make U.S. grains less competitive globally. MKTS/GLOB

Soybean oil futures BOv1 posted the biggest percentage declines, pressuring soybeans, as market players digested Tuesday's biofuel blending proposal from the U.S. Environmental Protection Agency.

Soyoil futures had jumped on Tuesday as traders awaited guidance. But industry representatives said the agency's proposal, including a 45-day comment period, failed to provide clarity on how to reallocate biofuel blending obligations under the government's Small Refinery Exemption program. Soyoil is the main U.S. feedstock for biodiesel.

"The EPA is no closer to finalizing biofuel policy than it was this summer, leaving biomass diesel production on hold," StoneX chief commodities economist Arlan Suderman said in a client note.

CBOT wheat futures fell as forecasts called for showers that should recharge soil moisture in the southern Plains, bolstering production prospects as farmers start to plant the 2026 winter wheat crop.

"The rains in the forecast are going to be beneficial for winter wheat planting, more so than for the row crops," said Terry Linn, analyst with Linn and Associates in Chicago.

Meanwhile, Statistics Canada raised its estimate of Canada's 2025 all-wheat harvest to 36.6 million metric tons, up 1.9% from last year and above its August 28 estimate of 35.548 million tons. The agency's latest estimates were based in part on satellite and climatic data.