Chicago | Reuters—Chicago Board of Trade soy futures rallied on Friday after China said it would cut its export incentives for used cooking oil, a move that could curtail the flood of imports into the U.S., market analysts said.
Corn and wheat futures also turned higher on technical buying.
On Friday, China’s finance ministry announced it would reduce or cancel export tax rebates for a range of commodities and other products, including “chemically modified animal, plant, or microbial oils and fats, effective Dec. 1.”
Read Also
U.S. grains: Wheat futures rise on supply snags in top-exporter Russia
U.S. wheat futures closed higher on Thursday on concerns over the limited availability of supplies for export in Russia, analysts said.
The proliferation of imported used cooking oil in the U.S. biofuel market has been a drag on demand for U.S. soyoil, but a slowdown in used cooking oil exports from China could boost that demand, according to analysts.
The most-active soybean contract on the Chicago Board of Trade (CBOT) Sv1finished up 11 cents at $9.98-1/2 per bushel.
CBOT wheat Wv1rose 6-1/4 cents to settle at $5.36-1/2 per bushel and corn Cv1rose 5 cents to end at $4.24 a bushel.
Soy and grain markets were bolstered by a round of short covering leading into the weekend, according to Austin Schroeder, commodity analyst at Brugler Marketing and Management.
Soybean and corn futures fell hard earlier in the week on news that Republican President-elect Donald Trump had nominated Lee Zeldin, a critic of biofuel, as head of the U.S. Environmental Protection Agency, raising questions about both export and domestic demand for the grain and oilseed.
Meanwhile, wheat futures were pressured by a rally in the U.S. dollar, which hit one-year highs this week as Trump’s election win, U.S. inflation data and comments by Federal Reserve head Jerome Powell fuelled expectations of a slower pace for U.S. interest rate cuts.
Wet weather in the Southern and Central Plains also pressured wheat futures, with Commodity Weather Group saying rains on Sunday and Monday would add to the region’s moisture surplus, with flood risks remaining minimal.
—Additional reporting by Gus Trompiz and Peter Hobson
