US soyabean futures rose on Thursday, rallying from early declines on short-covering and prospects for China to step up purchases of US supplies as the US-China Phase 1 deal goes into effect in the coming days, traders said.
Wheat futures fell and corn sagged as traders focused on prospects for large South American harvests.
As of 1:05 p.m. CST (1905 GMT), the Chicago Board of Trade March soyabean contract was up 2-1/2 cents at $8.95 per bushel, on track to post its ninth consecutive higher close.
CBOT March wheat was down 6 cents at $5.41-1/2 per bushel. March corn was down 3-1/2 cents at $3.79-1/2 a bushel, staying inside Wednesday's trading range.
Soyabeans turned higher as traders considered that the US-China Phase 1 trade agreement was due to go into effect 30 days after its Jan. 15 signing, potentially spurring export demand for US agricultural products. Commodity funds hold a net short position in CBOT soyabean futures, leaving the market vulnerable to short-covering rallies, and US markets will be closed on Monday for the Presidents Day holiday.
Soyabean futures drew additional support from a strong domestic soya crushing pace coupled with a lack of producer soyabean sales.
Others cautioned that China has been an aggressive buyer of Brazilian soyabeans in recent days, taking advantage of a plunge in the value of Brazil's currency. CBOT wheat futures fell, shrugging off support from strong weekly export data. The US Department of Agriculture reported export sales of US wheat in the week ended Feb. 6 at 687,100 tonnes (old and new crop years combined), topping trade expectations.
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