GRAINS-US soybean futures inch higher on China trade optimism

CHICAGO, Oct 22 (Reuters) - U.S. soybean futures firmed on Wednesday as traders remained hopeful for progress in trade talks with top soy buyer China and on a Japanese proposal to increase U.S. soy purchases, deals that could help U.S. farmers avert major losses.

Corn and wheat futures rose but remained range-bound as market players awaited fresh direction.

As of 1:05 p.m. CDT (1805 GMT), Chicago Board of Trade November soybean futures SX25 were up 2 cents at $10.32-1/2 per bushel while deferred contracts were mostly lower.

CBOT December corn CZ24 was up 3 cents at $4.22-3/4 per bushel and December wheat WZ25 was up 3-1/4 cents at $5.03-1/2 a bushel.

Markets are focused on a key meeting between U.S. President Donald Trump and Chinese President Xi Jinping in South Korea next week. Trump has said he wants a "fair deal" and has repeatedly called for China to resume purchases of U.S. soybeans.

"We don't know if anything will come of it," Sherman Newlin, broker at Risk Management Commodities, said of the upcoming U.S.-China meeting. "With the (U.S.) government shut down as well, there is nothing to go on. The market is in limbo."

Currently, there are no new sales of United States' soybeans to China and nothing is expected to be loaded in coming weeks, according to information from U.S. soy industry groups including the American Soybean Association and the U.S. Soybean Export Council.

Separately, Japan's new government is finalising a purchase package, including U.S. pickups, soybeans and gas, to present to Trump in trade and security talks next week, two sources told Reuters.

Brazilian oilseed group Abiove projected the South American country's 2025/26 soybean harvest at a record-high 178.5 million metric tons, up from 171.8 million a year earlier.

As the U.S. corn harvest progresses, CBOT December corn CZ25 has been stuck in a trading range between roughly $4.09 and $4.25 per bushel all month.

CBOT December wheat futures firmed on Wednesday but continued to hover a few cents above contract lows set last week, anchored by plentiful global wheat supplies.

Algeria’s state grains agency OAIC bought milling wheat in an international tender, European traders said. The size of the purchase in tonnage terms was not initially clear, but some initial estimates were as high as 600,000 metric tons. Traders suspected the wheat would be sourced from the Black Sea region or Argentina.