Updates for market close

By Heather Schlitz

CHICAGO, June 12 (Reuters) - Chicago corn, soy and wheat futures chopped up and down on Friday as short covering ahead of the weekend provided strength, though favorable U.S. crop weather and higher South American production forecasts maintained supply pressure while falling crude oil prices also weighed, traders said.

The most-active corn contract Cv1 on the Chicago Board of Trade settled 1 cent higher to $4.12-3/4 per bushel after hitting a contract low. CBOT soybeans Sv1 fell 1-1/2 cents to $11.13-1/2 a bushel, while CBOT wheat Wv1 fell 2-1/4 cents to $5.84-1/2 per bushel.

"I think a lot of it has to do with the fact that it's Friday and the market has been oversold," said Jack Scoville, vice president of Price Futures Group. "It looks to me like we're getting short covering and new buying going into the weekend."

Oil prices fell more than 3% on Friday to their lowest levels in nearly two months as U.S. and Iranian officials said they were close to an agreement to halt their war. O/R

A memorandum between the United States and Iran to halt the war could be signed as soon as Sunday, a Western source told Reuters on Friday, with Geneva emerging as the likeliest venue.

Corn and soybeans often follow crude oil prices, as both are used as feedstock for biofuels.

Soybeans continued to hover near a four-month low, with the drop in crude oil curbing oilseed prices.

In a widely followed monthly world report, the U.S. Department of Agriculture on Thursday increased its forecasts for this season's corn output in Argentina and Brazil, as well as soybean production in Argentina.

The USDA also raised its projection of global corn inventories at the end of 2026/27 to above a range of trade expectations.

In wheat, the agency cut its outlook for the U.S. harvest to the lowest in decades following drought, but nudged up its forecast of global supplies.