FORT COLLINS, Colo., Jan 23 (Reuters) - Speculators last week lightened up on their bullish Chicago corn and soybean views following a relatively mundane update from the U.S. government, but geopolitical concerns and variable weather in South America escalated supply uncertainties late in the week. CBOT grain and oilseed futures had mostly worked lower during the four-day trading week ended Jan. 18, which featured the U.S. Department of Agriculture’s biggest annual data release, an often-volatile event. In the week ended Jan. 18, money managers cut their net long position in CBOT corn futures and options to 326,523 contracts, a seven-week low, slightly below the year-ago levels and a reduction of about 18,000 on the week. (https://tmsnrt.rs/3tWa0jg) Data published Friday by the U.S. Commodity Futures Trading Commission also showed that money managers through the same date reduced their net long in CBOT soybean futures and options to 99,639 contracts from 106,879 a week earlier. (https://tmsnrt.rs/3FRULu2) Soybean futures had fallen nearly 2% in that period and corn was down fractionally as rain moved in for drought-stricken Argentine crops. But soy and corn bounced nearly 4% and 3%, respectively, in the last three sessions with tensions rising in the key exporting Black Sea region. Most-active corn and soybean futures reached seven-month highs late last week, and new-crop November soybeans and December corn both notched contract highs on Thursday. Commodity funds were pegged as buyers of 51,000 combined corn and soybean futures contracts between Wednesday and Friday. Weather models as of midday Sunday showed decent rain amounts ahead for some of southern Brazil’s parched crops, though it is uncertain how much of the recent damage is irreversible. Forecast rain accumulation is lighter in the southernmost areas. Argentina’s recent rains likely prevented a disastrous harvest, though forecast models indicate some risk that February could turn dry again. read more Cooler temperatures in the near term will be a favorable break from the record heat earlier this month. SOY PRODUCTS CBOT soybean oil futures jumped 6.6% between Wednesday and Friday, reaching a three-month high of 63.74 cents per pound on Friday. Benchmark Malaysian palm oil futures hit all-time highs on Friday, up more than 13% so far this year and 18% above what had been all-time highs in mid-May. Aside from crop struggles in top soybean product exporter Argentina, the global vegetable oil market has been concerned with limited palm oil supply. Labor issues have plagued output in No. 2 exporter Malaysia, and No. 1 Indonesia said Wednesday it was drafting a plan to curb shipments and tame prices. Money managers had lightly increased their net long in CBOT soybean oil futures and options through Jan. 18 on fractional price gains. That position of 58,208 contracts is a six-week high. Soybean meal futures plunged more than 5% through Jan. 18, and money managers cut their net long to 64,743 futures and options contracts compared with 72,920 a week earlier and about 78,000 a year earlier. WHEAT In the week ended Jan. 18, money managers snapped a seven-week selling streak in Chicago wheat futures and options, cutting their net short by just under 3,000 contracts to 24,901. Late-week jitters also took hold in the wheat market. CBOT wheat futures surged as much as 8% last week over fears exports could be disrupted with Russia building troops along its borders with Ukraine. U.S. and Russian diplomats on agreed to continue talks to avoid crisis despite little success in Geneva on Friday. read more Futures rose just 1.4% between Wednesday and Friday, and last week’s volatility is not seen significantly changing commodity funds’ bearish CBOT wheat views. Money managers in the latest three weeks have reduced their bullish Minneapolis wheat views by about two-thirds. As of Jan. 18, their net long stood at 3,857 futures and options contracts, the smallest since December 2020, and that was down from 5,734 in the prior week. March Minneapolis futures on Tuesday hit a four-month low of $8.72-1/4 per bushel, down 18% from the early November high. However, the contract added more than 3% in the latest three sessions. Most-active Kansas City wheat on Friday settled 6% higher than on the previous Friday, which had featured a three-month low. The contract ended last week 11% off the late November highs. Speculators have sold K.C. wheat futures and options in six of the last eight weeks, and their net long fell to 36,119 contracts as of Jan. 18. That is the lightest since late July and below the year-ago net long of about 58,000 contracts. Karen Braun is a market analyst for Reuters. Views expressed above are her own.