Chicago | Reuters — U.S. soybean futures rose on Wednesday, buoyed by renewed optimism about a U.S.-China trade deal as well as some bargain buying, traders said.
Corn futures were lower, giving up early gains on technical selling, while wheat futures firmed after two days of sharp declines.
Investors were reassured by a Bloomberg report that Beijing and Washington were moving closer to a deal.
Additionally, U.S. President Donald Trump said on Wednesday that trade talks with China were going “very well,” sounding more positive than on Tuesday when he said a trade deal might have to wait until after the 2020 U.S. presidential election.
Chicago Board of Trade January soybean futures closed up seven cents at $8.78 a bushel, their second day of gains following eight straight lower closes (all figures US$). The 0.8 per cent gain was the biggest percentage rise for the most-active contract since Nov. 7.
“The U.S. and China are reportedly ‘moving closer’ towards a deal despite lingering tensions, for whatever that’s worth at this point,” Matt Zeller, director of market information at INTL FCStone, said in a note to clients. “It does coincide with beans at least appearing to make a stand at six-week lows.”
But the gains in soy futures were limited by expectations of a big crop in South America that would provide China with another option to meet their import needs.
“Soybean prices look to have a limited upward potential considering the positive weather conditions currently in place in Brazil,” consultancy Agritel said.
CBOT March corn futures dropped 2-3/4 cents to close at $3.78-1/2 a bushel.
The contract turned lower after failing to hold support above its 20-day moving average for the third day in a row.
CBOT March wheat ended 2-1/4 cents higher at $5.27-1/2 a bushel, finding support around the 23.6 per cent retracement point on a Fibonacci chart tracking its autumn rally to the 4-1/2-month high it hit on Friday.
— Mark Weinraub is a Reuters commodities correspondent in Chicago; additional reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore.