CHICAGO (Dow Jones)--U.S. corn futures are expected to start higher Thursday as traders focus on poor weather threatening Argentina's crop and downplay an increase in China's production estimate.

Traders predict corn for March delivery, the most-active contract, will start 2 to 3 cents a bushel higher at the Chicago Board of Trade. In overnight electronic trading, the contract rose 2 1/4 cents, or 0.4%, to $5.86 1/2 a bushel.

Leading prices higher are worries that dryness may reduce production prospects in Argentina, the world's second largest exporter of corn after the U.S. The crop, which is mostly planted, will be harvested in the spring.

The outlook for the next 10 days doesn't look favorable, as minimal rainfall and hot temperatures are expected in key growing areas, according to Telvent DTN, a private weather firm. The conditions are particularly unwelcome as corn is entering a crucial development period called pollination, analysts said.

Corn futures on Wednesday reached a five-week high near $6 a bushel on worries global supplies will tighten if Argentina's crop falls short of expectations. Futures prices reached a 27-month high in November when the U.S. government cuts its harvest estimate for the third time.

"Argentina's weather forecast remains threatening," Chicago-based agricultural research firm AgResource Co. said.

Concerns about Argentina overshadow an increased corn production estimate from the state-backed China National Grain and Oil Information Center, traders said. The center on Thursday pegged production at 172.5 million metric tons, up 5% from its 2009 estimate and 2.7% above the U.S. government's most recent estimate for 2010.

Market participants have been paying attention to production in China due to projections that China will have to increase corn imports to meet rising demand and make up for production shortfalls. China's increased crop forecast is seen as slightly bearish for futures prices, but "few in the Chinese trade have faith in the estimate," AgResource said.

Traders have been waiting for China to make significant purchases, as export demand has been lackluster lately. Total weekly U.S. corn export sales, issued Thursday for the week ended Dec. 9, were 880,100 tons, within analysts' expectations of 600,000 to 1.1 million.

Despite expectations for futures to start higher Thursday, the corn market could come under pressure from profit-taking heading into a shortened holiday trading week, traders said. The CBOT is closed Dec. 24 for Christmas Eve. Corn futures on Wednesday closed lower after reaching the five-week high.

-By Tom Polansek, Dow Jones Newswires; 312-341-5780;