Soybeans rise on Chinese demand, higher crude oil prices

BEIJING: Chicago soybeans rose on Monday, supported by strong Chinese demand and higher crude oil prices.

The most-active soybean contract on the Chicago Board of Trade (CBOT) edged 0.31% higher to $13-1/2 a bushel by 0231 GMT.

Chinese state buyers have stepped up purchases of US soybeans ahead of Chinese President Xi Jinping’s visit to Washington later this month.

Markets are awaiting greater clarity from the summit on future demand from the world’s top soybean importer.

Soybeans drew additional support from stronger soyoil prices, given their role in biofuel production.

Soyoil gained 0.57% to 70.08 cents per pound, tracking higher crude oil prices.

Oil prices jumped more than 2% after fresh Houthi strikes on Saudi Arabia and Iranian attacks on ships in the Gulf compounded supply concerns following the closure of a key Saudi oil pipeline.

However, gains in soybeans were limited after the US Department of Agriculture raised its soybean production forecast on Friday.

Wheat rose 0.03% to $7.25-1/2 a bushel as traders assessed risks in the Black Sea region.

Renewed diplomatic efforts to end Russia’s war in Ukraine have weighed on prices, though fresh Russian attacks have kept markets focused on the ongoing disruption to vital Black Sea grain trade routes.

“World wheat trade continues to straddle the headlines of the conflict between Russia and Ukraine with the seemingly plentiful stock levels,” said Josh Lawrence, an analyst at IKON Commodities. “Attention on demand will now focus on increased tender activity including this week with Pakistan, as well as any change in buying activity from key importers across Southeast Asia,” he added.

A government agency in Pakistan issued an international tender to purchase and import 750,000 metric tons of wheat, European traders said. Corn dropped 0.09% to $5.29-3/4 a bushel, despite support from higher oil prices and expectations of a smaller US harvest.

US farmers will harvest less corn than previously forecast this autumn, the US Department of Agriculture said on Friday, after hot summer weather raised concerns about crop damage.

Commodity funds were net sellers of CBOT corn, soy and wheat, traders said on Friday.