Soybeans tick up, eyes on US-China trade talks
HAMBURG: Chicago soybean futures were slightly firmer on Tuesday, with attention on whether trade talks between Washington and Beijing will open the door for more US soybean exports to China.
"Soybean markets are pausing to see what results the trade talks between the US and China actually bring while there is also attention on unfavourable crop weather in Brazil," said Matt Ammermann, commodity risk manager with INTL FCStone. "Wheat and corn are seeing support from US export hopes."
Chicago Board of Trade March soybeans were up 0.1 percent at $9.25-1/2 a bushel at 1202 GMT after touching a 3-1/2 week high on Monday.
March wheat rose 0.4 percent to $5.19-1/4 a bushel. March corn rose 0.4 percent to $3.84 a bushel.
US Commerce Secretary Wilbur Ross predicted on Monday that Beijing and Washington could reach a trade deal that "we can live with" as the two countries resumed talks about a dispute which has slashed US soybean exports to China.
Chinese state firms bought at least three cargoes of US soybeans or about 180,000 tonnes on Monday, traders said. One said the total was closer to 900,000 tonnes.
"The key is whether negotiations will reopen the door for more US soybean exports to China," Ammermann said. "There were reports on Monday that China has been buying US soybeans again."
"But the US government shutdown means that USDA (US Department of Agriculture) export sales are not being announced."
"US markets are used to being given rapid and precise data on export sales. Now the concern is that if China has been buying US soybeans, we could get a big wave of export sales data when the government shutdown ends."
The soybean market wants to see a "positive outcome" from the trade talks before gaining further or sustaining recent price gains, said Phin Ziebell, agribusiness economist at National Australia Bank.
Growing hopes of more US export sales were also underpinning wheat and corn.
"Russian wheat is now getting more expensive following the country's export surge in recent months. Russia was the cheapest
wheat in the world but that has changed," Ammermann said.
There is also a major purchase tender in the market from Algeria but this is likely to be largely French business.
"There is chatter that China could buy US corn if trade talks are successful but no confirmation," Ammermann said. "Ukrainian corn is also looking more expensive than US supplies."