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U.S. soybean futures are expected start lower Thursday, pressured by Midwest rains and slowing demand.

CBOT soybeans are called to open down 2 cents to 3 cents lower.

In overnight trading, Chicago Board of Trade August soybeans were up 1/4 cent at $13.76 a bushel, and new crop November futures were down 3 1/4 cents at $13.77 1/4.

Rains moving across the northern Midwest are expected to weigh on prices, as the moisture is seen alleviating stress from above normal heat in the central U.S. crop belt. Slower domestic and export demand are seen adding to the negative tone.

However, soy futures are expected to remain within recent trading ranges, with apprehension about yield potential, as the southern Midwest continue to miss out on rain amid persistent heat, analysts said.

Grain traders are keeping a close eye on the weather and condition ratings because farmers need to harvest a large crop to replenish low inventories. The trade is concerned about conditions, as soybeans head into to their yield development stage of pod filling in August.

Lagging demand will apply pressure, as historically high price levels are showing signs of rationing buyer interest.

"Soybeans export sales slowed once again, as the market traded near $14 a bushel," said Doug Bergman, broker with brokerage MF Global in Chicago in a market note.

U.S. soybean sales totaled 372,700 metric tons in the week ended July 21, the U.S. Department of Agriculture reported in its weekly sales report. Sales of 362,200 tons were for delivery in the next marketing year, which begins Sept. 1. Sales increases were noted to unknown destinations of 110,000 tons and China 224,000 tons. Sales for the current marketing year resulted in net sales of 10,500 tons.

The Census Bureau reported soybeans crushed in June totaled 124.3 million bushels, below the average of trade estimates at 125.1 million and below May's crush rate of 128 million. Soymeal inventories or stocks dropped to 289,326 short tons from 374,957 in May. Soyoil stocks slipped to 3.115 billion pounds from 3.178 billion in May.

Traders are also focused on U.S. debt and its impact on the economy, with outside financial markets poised to offer price weakness. A firmer U.S. dollar encourages traders to reduce some risk exposure as they await a decision on the U.S. debt ceiling.

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