CHICAGO: US soybean prices rebounded Wednesday after a two-day sell-off, underpinned by short-covering, talk of Chinese demand and worries that US farmers might not plant enough soybeans this spring to meet global demand.
Wheat futures posted modest gains, consolidating after declines earlier this week, while corn was choppy.
At the Chicago Board of Trade as of 10:42 a.m. CDT (1542 GMT), front-month May soybeans were up 4-1/2 cents at $13.49-1/2 per bushel. The November contract, which represents the new US crop to be harvested this fall, was up 8-1/4 cents at $13.15-1/2.
CBOT May wheat was up 1 cent at $6.43-1/2 a bushel while May corn was down 1 cent at $6.46-1/2.
Traders noted rumors that China bought two cargoes of US soybeans. CBOT soybean futures are up 12 percent since the start of this year, buoyed by demand from China, the world's top soy buyer, along with projected crop shortfalls in South America. CBOT soybeans set a six-month high on Monday.
A strike by truckers in Argentina this week fueled worries about the availability of South American soy supplies.
"I think the Argentine truck strike is getting some publicity," said Mike Zuzolo with Global Commodity Analytics in Lafayette, Indiana. "If the South American supplies are not available for increased purchases by China, that suggests you want to keep some premium for beans."
China is on course to import 25 percent more soybeans in the first half of this year than the first six months of 2010, an official think tank said.
"That's a pretty supportive number," Barclays Capital analyst Sudakshina Unnikrishnan said. "In the short term, a lot is going to depend on imports, especially by China."
EARLY START TO US PLANTING
Summer-like weather in the US Midwest this month supported ideas that farmers are likely to plant corn aggressively, a factor that hung over the corn market and supported soybeans.
"It does look like the (weather forecast) models have turned back to a warmer pattern, all the way into the end of the month," Zuzolo said.
"That does promote some pretty good potential for corn acreage. We may be back on track in terms of trade sentiment that the planters will roll hard for corn, at the expense of beans," he added.
The US Department of Agriculture will release a report of prospective US crop plantings, along with quarterly US grain stocks, on March 30.
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