GRAINS-Soybeans touch seven-week low on broad sell-off in agriculture markets

By P.J. Huffstutter

CHICAGO, Dec 15 (Reuters) - Chicago Board of Trade soybean futures touched a seven-week low on Monday amid a broad sell-off in agriculture markets, as soy traders continued to shed risk amid ongoing concerns over the pace of U.S. exports and expectations of a hefty Brazilian harvest, market analysts said.

Wheat futures slumped as Argentina's large crop kept world supplies plentiful, traders said. And corn futures were pressured by cheap Argentine feed wheat, which could reduce corn demand.

Chicago Board of Trade most-active soybeans Sv1 settled down 5 cents at $10.71-3/4 per bushel, the lowest since October 30. Earlier in the session, the most-active contract dipped down to $10.67, the contract's lowest since October 27.

Meanwhile, CBOT wheat Wv1 settled down 8-1/2 cents at $5.20-3/4 a bushel. During the trading session, the most-active contract dropped to $5.19-1/2 a bushel, the lowest since October 31. Corn futures Cv1 settled down 1 cent at $4.39-3/4 a bushel - after earlier touching a low of $4.36-3/4 a bushel, the lowest price since November 25.

Soybeans faced weakness as the pace of Chinese purchases of U.S. beans following the trade truce between the two nations has disappointed traders, remaining well below the 12 million metric ton purchases flagged.

They also felt carry-over pressure from data released on Friday from the U.S. Commodity Futures Trading Commission, which showed that managed commodity funds had built a massive net long position in CBOT soybean futures by mid-November, leaving the market prone to bouts of long liquidation, said Chuck Shelby, president of Risk Management Commodities, a division of Zaner Ag Hedge.

As of Friday, total open interest in CBOT soybeans has fallen every day since December 4 - even as futures have declined, in another sign of long liquidation.

The CBOT data showed a delayed snapshot of where funds had been in their positions as of November 18, when the market was keenly focused on U.S.-China trade talks. Release of the information was delayed during the 43-day U.S. government shutdown in October and November.

"The data delay is pretty frustrating for the market right now," Shelby said. "What we're seeing today is a pretty broad-based commodity sell-off."

Meanwhile, markets continue to struggle to define Chinese demand for U.S. soybeans, said Matt Ammermann, commodity risk manager at StoneX. "Senior U.S. officials have said China will buy 12 million tons of U.S. soybeans, but the timescale is uncertain and China has not confirmed this number."