GRAINS-Soybeans set for second weekly drop on ample supply, China demand woes

CANBERRA/PARIS, Dec 12 (Reuters) - Chicago soybean futures fell on Friday and were on track for a second consecutive weekly drop, as support from a softer dollar and recent Chinese purchases was pressured by ample supplies and doubts China will buy enough to stem further declines.

Wheat and corn also fell. Wheat was heading for a fourth consecutive weekly decline due to abundant global supply, with Argentina and Australia currently harvesting big crops.

The most-active soybean contract on the Chicago Board of Trade (CBOT) Sv1 was down 0.9% at $10.83-1/2 a bushel, as of 1200 GMT, and has lost 2% from last Friday's close.

CBOT wheat Wv1 fell 0.7% to $5.30 a bushel, set for a weekly loss of 1%, while corn Cv1 lost 0.4% to $4.44-3/4 a bushel and was flat over the week.

The dollar steadied on Friday but was still set for its third straight weekly drop, after the U.S. Federal Reserve cut interest rates with the prospect of further cuts next year. A weaker dollar makes U.S. crops more competitive in export markets.

Soybeans rose to a 17-month high of $11.69-1/2 in November on optimism that China would quickly buy large quantities from the United States, but the rally faded as the actual pace of buying disappointed traders.

That said, the U.S. Department of Agriculture (USDA) confirmed sales of 264,000 tons of U.S. soybeans to China and another 226,000 to unknown destinations on Thursday, as well as 186,000 tons of U.S. corn to unknown destinations.

Meanwhile, China's state stockpiler Sinograin sold most of the soybeans it offered in an auction of state reserves, traders said, the first of what is expected to be a series of sales that would make room for more U.S. supplies.

"China will need to continue buying large amounts of U.S. soybeans to keep prices up," said Andrew Whitelaw, an analyst at consultants Episode 3.

Brazil is the biggest soybean producer. Crop agency Conab on Thursday lowered its 2025-26 Brazilian harvest estimate by around 550,000 metric tons to 177.12 million tons, still a record amount.