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GRAINS-Wheat rises to 1-week peak on technical bounce, U.S. export prospects

Julie Ingwersen

(Recasts; updates prices, adds quotes, changes byline, changes dateline from previous PARIS/KUALA LUMPUR) CHICAGO, Jan 3 (Reuters) - U.S. wheat futures rose about 1.2 percent on Thursday, reaching a one-week high on a technical rebound from multi-month lows and optimism about U.S. export prospects, analysts said. Soybeans hit a two-week top on rumors of Chinese buying interest and worries about declining Brazilian crop prospects, while corn followed the firm trend. As of 12:49 p.m. CST (1849 GMT), Chicago Board of Trade March soft red winter wheat was up 6 cents at $5.12-3/4 a bushel. A day earlier, the contract dipped to $5.01-1/4, its lowest level since January 2018. When the contract failed to drop below psychological support at $5, buyers returned. "It's more technical than fundamental today," said Terry Reilly, senior analyst with Futures International in Chicago. Excessive moisture in Argentina's wheat belt remained a worry. "Traders are still a little bit nervous about the Argentine crop quality, and also U.S. wheat is getting a little more competitive," Reilly said. A weaker dollar lent background support, making U.S. grains more competitive globally, at a time when winter weather may be slowing shipments from top exporter Russia. "U.S. wheat became competitive over the holidays, inviting active buying to start the new calendar year," Arlan Suderman, chief commodities economist at INTL FCStone, said in a client note. CBOT soybean and corn futures posted smaller advances. CBOT March soybeans were up 3 cents at $9.10 a bushel after reaching $9.13-1/2, its highest level since Dec. 20. CBOT March corn was up 3 cents at $3.78-3/4. Soybeans ticked higher as the oilseed market assessed weather risks for Brazilian crops and sought evidence of more Chinese purchases of U.S. supplies as part of a trade truce. China last month resumed large purchases of U.S. soybeans after Washington and Beijing agreed to a 90-day truce in a trade dispute that has brought tit-for-tat tariffs on goods including soybeans, the most valuable U.S. agricultural export to China.

Chatter about further Chinese purchases has buoyed soy futures at the turn of the year. However, a partial government shutdown in the United States has prompted the U.S. Department of Agriculture (USDA) to suspend daily and weekly export sales reports, depriving traders of potential confirmation of further deals. "Traders are trying to verify the rumors of Chinese soybean import interest from the U.S. We don't see it reflected in the cash market," Reilly said. The USDA will decide on Friday whether to delay a series of crop reports scheduled for release on Jan. 11.

CBOT prices as of 12:47 p.m. CST (1847 GMT):

Net Pct VolumeLast change changeCBOT wheat WH9 513.00 6.25 1.2 40339CBOT corn CH9 378.75 3.00 0.8 65085CBOT soybeans SH9 910.00 3.00 0.3 46810CBOT soymeal SMH9 316.30 1.40 0.4 32576CBOT soyoil BOH9 28.39 0.21 0.8 31298

NOTE: CBOT March wheat, corn and soybeans shown in cents per bushel, March soymeal in dollars per short ton and March soyoil in cents per lb.

(Additional reporting by Gus Trompiz in Paris and Emily Chow in Kuala Lumpur Editing by David Goodman and Paul Simao)