December 4, 2019 / 4:49 PM / 3 months ago

GRAINS-Soybean futures rise on renewed trade hopes; corn weak, wheat steady

(Recasts, updates with U.S. trading, adds new analyst quote, changes byline/datline; previous PARIS/SINGAPORE)

By Mark Weinraub

CHICAGO, Dec 4 (Reuters) - U.S. soybean futures rose on Wednesday, buoyed by renewed optimism about a U.S.-China trade deal as well as some bargain buying, traders said.

Corn futures were lower, giving up early gains on technical selling, while wheat futures steadied after two days of sharp declines.

Investors were reassured by a Bloomberg report that Beijing and Washington were moving closer to a deal.

Additionally, U.S. President Donald Trump said on Wednesday that trade talks with China were going “very well,” sounding more positive than on Tuesday when he said a trade deal might have to wait until after the 2020 U.S. presidential election.

At 10:38 a.m. CST (1638 GMT), Chicago Board of Trade January soybean futures were up 7 cents at $8.78 a bushel, on track for a second day of gains following eight straight lower closes.

“The U.S. and China are reportedly ‘moving closer’ towards a deal despite lingering tensions, for whatever that’s worth at this point,” Matt Zeller, director of market information at INTL FCStone, said in a note to clients. “It does coincide with beans at least appearing to make a stand at six-week lows.”

But the gains in soy futures were limited by expectations of a big crop in South America that would provide China with another option to meet their import needs.

“Soybean prices look to have a limited upward potential considering the positive weather conditions currently in place in Brazil,” consultancy Agritel said.

CBOT March corn futures were down 3-1/2 cents at $3.77-3/4 a bushel.

The contract turned lower after failing to hold support above its 20-day moving average for the third day in a row.

CBOT March wheat was 1/2 cent lower at $5.24-3/4 a bushel, consolidating around the 23.6 percent retracement point on a Fibonacci chart tracking its fall rally to the 4-1/2-month high it hit on Friday.

Traders also said a bleak fundamental picture was casting a bearish tone on the wheat market.

“The rally in wheat prices was overdone and not really connected to global prices,” said Ole Houe, director of advisory services at brokerage IKON Commodities in Sydney. “World supplies remain plentiful despite the Australian drought and at the moment the task of the world market is to simply chew through stocks.” (Additional reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore; Editing by Sriraj Kalluvila and Jonathan Oatis)

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