(Updates U.S. market activity to close, adds CFTC)
By Michael Hirtzer
CHICAGO, April 22 (Reuters) - U.S. wheat, soybeans and corn plunged on Friday, with wheat posting its largest daily declines in three years as investors locked in profits after huge gains earlier this week, and extended weather outlooks were seen as beneficial for crops.
Chicago Board of Trade wheat shed 6 percent, but still managed a weekly rise of 2.7 percent. Soybeans tumbled 3 percent, cutting the week's gains in half.
Gains this week in agriculture futures came as other commodities such as crude oil have also surged, and the Thomson Reuters Core Commodity Index commodities hit a four-month high.
"While this recent rally has the potential to run further to the upside ... we believe that it is not yet driven by a sustainable shift in fundamentals," Goldman Sachs analysts said of commodities markets in a note.
U.S. Commodity Futures Trading Commission data released after the close of trading showed speculative investors adding to their net soybean long, and trimming their net short in wheat and corn.
CBOT July soybeans settled 31-1/4 cents lower at $9.96-1/4 per bushel. CBOT July wheat eased 29-1/2 cents to $4.74 per bushel and CBOT July corn was off 14-1/4 cents to $3.75-1/2.
Light weekend showers were predicted in Argentina before conditions turn drier during the next 10 days, allowing the soybean harvest to resume, the Commodity Weather Group said in a note to client.
Harvest delays and limited availability for soy shipments at port in Argentina contributed to massive investment-fund buying in futures as volume and open interest in soybeans surged to records this week. But both Argentina and Brazil were expected to harvest massive crops and world supplies of oilseeds and grains were abundant.
Rains were forecast in the southern U.S. Plains winter wheat belt and farmers have also made steady progress sowing corn in the Midwest, in addition to selling large volumes of existing supplies as prices surged.
"Everybody is very happy with the soil moisture profile (in the Midwest)," said Pira Energy Group analyst Peter Meyer, who drove from Ohio to South Dakota this month surveying conditions.
Meyer said investors already were looking ahead to U.S. Department of Agriculture's May 10 supply report, when the agency will incorporate outlooks for increased corn sowings with early planting progress data to determine yield forecasts.
"The (USDA) acres are legit, if not a little bit low," Meyer said.
Additional reporting by Naveen Thukral in Singapore and Gus Trompiz in Paris; Editing by Tom Hogue, Ruth Pitchford, Diane Craft