December 3, 2018 / 2:07 AM / 7 months ago

GRAINS-Soybeans climb to near 6-month high on U.S.-China trade truce

    * Soybeans up more than 2 pct, wheat gains 1.2 pct, corn 1.3
    * Optimism after U.S.-China trade truce drives prices higher

 (Recasts with comment, details)
    By Naveen Thukral
    SINGAPORE, Dec 3 (Reuters) - Chicago soybeans climbed
on Monday to their highest in almost six months, rising more
than 2 percent after the United States and China agreed a 90-day
truce that will permit talks to end a festering trade war that
has roiled commodities markets.
    The White House said on Saturday that President Donald Trump
told Chinese President Xi Jinping during talks in Argentina that
he would not boost tariffs on $200 billion of Chinese goods to
25 percent on Jan. 1, as previously announced.
    Beijing for its part agreed to buy an unspecified but "very
substantial" amount of agricultural, energy, industrial and
other products, the White House said in a statement.
    The Chicago Board of Trade most-active soybean contract
 was up 2.2 percent to $9.14 a bushel by 0140 GMT, after
hitting its highest since mid-June at $9.24 a bushel.
    Wheat gained 1.2 percent to $5.22 a bushel and corn
 advanced 1.3 percent to $3.82-1/2 a bushel. While corn hit
its highest since early July, wheat touched its highest since
late September.
    Meanwhile China's soymeal futures lost 1.5 percent
to 3,010 yuan ($434.22) a tonne. 
    While markets welcomed the U.S.-China trade truce news, some
observers were cautious on how much had been achieved. 
    "A range of views on the trade talks have, and will, emerge
over the next day or so," said Tobin Gorey, director of
agricultural strategy, Commonwealth Bank of Australia. "A lot of
that opinion is likely to assess the progress as being modest."
    The trade war between the two countries has drastically
curbed U.S. soybean exports to China, by far the world's biggest
bean importer.  
    After imposing retaliatory tariffs on U.S. soybean imports,
China has been taking mainly Brazilian beans, threatening to
leave a bumper U.S. harvest piled up in storage or rotting in
    But gains in U.S. soybeans and other feed grains are likely
to be limited amid slowing demand in China.
    China's imports of soybeans are set to drop as an outbreak
of African swine fever hits its huge pig herd and saps demand
for the animal feed ingredient, making it easier for buyers to
keep shunning U.S. cargoes amid the Sino-U.S. trade war.

    The Commodity Futures Trading Commission's weekly
commitments of traders report also showed that non-commercial
traders, a category that includes hedge funds, trim their net
short position in soybeans in week to Nov. 27.
 Contract    Last    Change  Pct chg  Two-day chg  MA 30   RSI
 CBOT wheat  522.00  6.25    +1.21%   +2.05%       512.78  69
 CBOT corn   382.50  4.75    +1.26%   +2.89%       377.42  69
 CBOT soy    914.00  19.25   +2.15%   +2.64%       876.58  72
 CBOT rice   10.95   $0.07   +0.60%   +1.20%       $10.81  64
 WTI crude   52.94   $2.01   +3.95%   +2.90%       $59.31  
 Euro/dlr    $1.134  $0.002  +0.20%   -0.47%               
 USD/AUD     0.7354  0.004   +0.53%   +0.49%               

($1 = 6.9320 Chinese yuan renminbi)

 (Reporting by Naveen Thukral
Editing by Kenneth Maxwell)
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