GRAINS-Soybeans at three-month high on China demand hopes

By Naveen Thukral and Gus Trompiz

SINGAPORE/PARIS, Feb 18 (Reuters) - Chicago soybean futures hit their highest in three months on Wednesday, supported by high U.S. crushing levels and expectations of more Chinese purchases of U.S. supplies.

Wheat rebounded after a 2% slide on Tuesday, with weather risks and a swift end to latest peace talks between Russia and Ukraine adding some uncertainty.

Corn edged higher.

The most-active soybean contract on the Chicago Board of Trade (CBOT) Sv1 ended the overnight session up 0.5% at $11.55 a bushel. It earlier reached its highest since mid-November at $11.59.

"Soybeans remain supported by expectations of additional Chinese purchases and strong U.S. crush data," CM Navigator analyst Donatas Jankauskas said.

Soybeans rallied after U.S. President Donald Trump said earlier this month that China is considering buying an additional 8 million metric tons of U.S. soybeans, and a press report said Trump and Chinese President Xi Jinping could extend their countries' trade truce for as long as a year.

HIGHEST ON RECORD

The U.S. soybean crush in January reached its highest level on record for the first month of the year, while soyoil stocks ballooned to their highest since April 2023, according to monthly National Oilseed Processors Association (NOPA) data issued on Tuesday.

However, Lunar New Year holidays in China this week have tempered hopes of immediate purchases.

Soybean by-product soyoil extended gains, with the most-active futures BOv1 up 3% after earlier hitting their highest since September 2023.

The U.S. Environmental Protection Agency is expected to submit proposed biofuel blending quotas for 2026 to the White House this week for final review, sources told Reuters.

The report kept attention on the prospect for increased blending requirements for biofuel, a major source of demand for soyoil.

CBOT wheat Wv1 rose 1.1% to $5.48-1/4 a bushel and corn Cv1 gained 0.3% to $4.27-1/2 a bushel.

A cold snap across most of Ukraine following a thaw has led a crust of ice to form on fields that may damage winter wheat and rapeseed, farmers union UAC said on Wednesday.

Peace talks between Ukraine and Russia in Geneva on Wednesday ended after only two hours, with Ukrainian President Volodymyr Zelenskiy describing them as "difficult".