GRAINS-Soybeans consolidate after rebound on U.S.-China deal hopes

PARIS/CANBERRA, Oct 3 (Reuters) - Chicago soybean futures edged lower on Friday, consolidating after a two-day rally fuelled by hopes that upcoming U.S.-China talks could revive stalled soybean trade.

Corn and wheat were little changed after rebounding with soybeans from multi-week lows on Wednesday.

The most-active soybean contract on the Chicago Board of Trade (CBOT) Sv1 was down 0.1% at $10.22-1/2 a bushel at 1058 GMT, though still up slightly over the week.

The price benchmark hit a seven-week low below $10 on Wednesday before recovering on the back of comments by U.S. President Donald Trump that soybeans would be a major topic of discussion when he meets with Chinese President Xi Jinping in four weeks.

Meanwhile, U.S. Treasury Secretary Scott Bessent on Thursday predicted a "pretty big breakthrough" from the Trump-Xi talks while also flagging U.S. government aid for soybean farmers.

Chinese importers have not yet bought soybeans from the autumn U.S. harvest, costing U.S. farmers billions of dollars in lost sales amid a trade war between the two nations.

Since Trump's comment, funds have been significant net buyers not only of CBOT soybeans, but also of corn and wheat, traders say.

However, with the meeting still weeks away and a U.S. government shutdown delaying the release of supply and demand data, "the bearish tone will remain in place," said Rabobank analyst Vitor Pistoia.

Attention is also turning towards planting prospects for the next crop cycle in South America.

A lack of rain in Brazil during soybean planting may lower the potential for the crop, but the reality of plentiful global supply will remain, Pistoia said.

In cereals, CBOT corn Cv1 was unchanged at $4.21-3/4 a bushel while CBOT wheat Wv1 was up 0.1% at $5.15 a bushel.

Ample global supply remained a drag on cereals, though the wheat market found some support from fresh importer demand this week. GRA/TEND

The United Nations' Food and Agriculture Organization on Friday increased its forecast for 2025 global cereal output and now expects the biggest year on year rise since 2013.

In the southern hemisphere, Argentina's 2025/26 wheat yields are nearing historic highs thanks to abundant soil moisture, the Buenos Aires grains exchange said.

"The global supply is more than comfortable, and importers remain relaxed, leaving markets without any positive dynamic demand edge to boost prices," British merchant Frontier Agriculture said of wheat.