GRAINS-Soybean, corn futures touch 1-month highs as crude oil soars

By Julie Ingwersen

CHICAGO, Oct 23 (Reuters) - U.S. soybean and corn futures rose on Thursday to one-month highs, spurred by a jump in crude oil CLc1 following U.S. sanctions on Russia's two biggest oil firms along with hopes for progress in U.S.-Chinese trade talks.

Wheat futures climbed 1.8%, supported by firming domestic cash markets and possible fund short-covering, analysts said.

Chicago Board of Trade November soybeans SX25 settled up 10 cents at $10.44-3/4 per bushel after reaching $10.45, the contract's highest since September 19.

CBOT December corn CZ25 ended up 5 cents at $4.28 a bushel and December wheat WZ25 finished up 9-1/4 cents at $5.13 a bushel.

Crude oil surged 5% after the U.S. imposed sanctions on major Russian suppliers Rosneft and Lukoil over the Ukraine war. The sanctions mean refineries in China and India will need to seek alternative suppliers to avoid exclusion from the Western banking system, analysts said. O/R

Soybeans and corn sometimes follow oil prices as the crops are widely processed for use in biofuel. O/R

The soybean market also found support from prospects for a U.S.-China trade deal after their standoff this year halted massive U.S. soybean sales to China.

U.S. President Donald Trump maintained an upbeat tone about reaching agreements with his Chinese counterpart Xi Jinping when they are due to meet in South Korea next week, reiterating that the resumption of soybean purchases is a key area of discussion.

Some analysts noted brisk soy demand from buyers other than China as well as domestic soy processors.

"The cash markets are really strong, not only in the interior (Midwest) but also for export. ... We are the cheapest origin versus Brazil," said Tom Fritz, a partner with EFG Group in Chicago.

Similarly, corn futures found support from cash-market strength. Cash basis bids for corn firmed at a few locations this week, reflecting a lack of farmer offerings as well as uncertainty about the size of the crop, given anecdotal reports from farmers of underwhelming yields, Fritz said.

"We've got a fairly decent (corn) export market and a great domestic market. And the chatter continues about 'how small is the yield,'" Fritz said.

The U.S. Department of Agriculture has not released updated U.S. crop estimates since mid-September due to the ongoing government shutdown.

Wheat futures rose on signs of firming U.S. cash markets and possible short-covering by commodity funds who are believed to hold a net short position in CBOT wheat futures, analysts said.

However, the U.S. Commodity Futures Trading Commission has not released its weekly Commitments of Traders report, which outlines net fund positions, since last month.

On the global front, the International Grains Council raised its estimate of the 2025/26 world wheat crop by 8 million metric tons to 827 million tons, a record high and up 1.1% from the prior season. The IGC left its 2025/26 world corn crop outlook at 1.297 billion tons.