BEIJING/PARIS: Chicago soybeans extended gains on Thursday after US President Donald Trump said China had raised a target for US soybean purchases under a trade truce.
Corn and wheat ticked up with spill-over support from soybeans, though a firmer dollar and easing weather concerns capped the cereal markets.
The most-active soybean contract on the Chicago Board of Trade (CBOT) was up 1.1percent at USD11.04-1/4 a bushel at 1144 GMT.
That followed a 2.5percent rise on Wednesday, though the contract remained below a two-month high of USD11.15-1/4 struck during that session.
Soybeans rallied on Wednesday after Trump said China was “lifting the soybean count to 20 million tons for the current season”, suggesting China could buy 8 million metric tons of US soybeans in 2025/26 on top of approximately 12 million tons already booked since the trade truce in late October.
The news surprised traders who have expected China to focus on buying cheaper Brazilian beans in the coming months as Brazil’s new crop comes onto the market.
“Typically Chinese purchases of US soybeans taper off from January. Regardless, the lift to 20 million metric tons of US soybean purchases will add some much-needed boost to the soy complex,” said Sean Hickey, analyst at Bendigo Bank Agribusiness.
Such additional purchases may represent a political gesture by Beijing, despite higher costs, ahead of a planned visit by Trump to China in April, according to analysts.
Traders were cautious, however, given the potential strain on US supply from the new export volume cited by Trump.
“If China buys an extra 8 million tons, the US will get really tight in soy. If it happens, it’s a game changer but will it happen?,” a European trader said.
Brazil, the world’s largest soybean producer and exporter, could produce a record 181.6 million tons of soybeans in 2025/26, consultancy StoneX said on Monday, as it raised its forecast from January.
CBOT wheat was up 0.2percent at USD5.28 a bushel while corn added 0.2percent to USD4.30-1/2 a bushel.
Nearly all Russian crops were in normal condition as of February 5, Deputy Prime Minister Dmitry Patrushev was quoted as saying on Thursday.
Wheat traders have been monitoring severe cold in US, Russian and Ukrainian production belts, but snow cover is expected to limit potential crop losses.
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