CHICAGO, Dec 26 (Reuters) - U.S. soybean futures jumped 1 percent on Tuesday, heading for their second straight session of gains, as investors bought back short positions amid extended forecasts for warm and dry weather in Argentina, traders said.
Wheat futures were narrowly lower and corn about flat at the Chicago Board of Trade as volumes remained relatively light following Monday's Christmas holiday.
CBOT January soybeans were up 9 cents to $9.58-1/2 per bushel at 11:46 a.m. CST (1746 GMT), rebounding from a three-month low on Friday.
"Funds are sitting on a sizable short and I don't think they feel good about it," said Dan Basse, president of AgResource Co.
Speculative investors, including hedge funds, expanded net short positions in soybeans and corn and trimmed their net shorts in wheat in the latest reporting week, Commodity Futures Trading Commission data showed on Friday.
Abundant global supplies still anchored prices for soy and grains, but a dry weather pattern was lingering in Argentina, potentially reducing yield potential in the No. 3 global soy producer after the United States and Brazil.
Temperatures were expected to remain below freezing for the next week in much of the U.S. Plains and Midwestern winter wheat-growing areas, potentially putting dormant plants at risk of damage, meteorologists and traders said.
But the overall lack of bullish news for wheat and corn weighed after prices for the crops reached multiweek highs in recent sessions.
The U.S. Department of Agriculture said 1.3 million tonnes of U.S. soybeans, 609,281 tonnes of corn and 493,550 tonnes of wheat were inspected for export last week, all relatively near analysts' expectations. (Reporting by Michael Hirtzer, editing by G Crosse)