GRAINS-Price of soybeans at three-month high on China demand hopes

By Heather Schlitz

CHICAGO, Feb 18 (Reuters) - Chicago soybean futures hit their highest price in three months on Wednesday, supported by high U.S. crushing levels and expectations of more Chinese purchases of U.S. soy, analysts said.

Wheat rebounded after a 2% slide on Tuesday on technical trading, while weather risks and a swift end to the latest peace talks between Russia and Ukraine added uncertainty to the market. Corn chopped up and down amid a lack of fresh news.

The most-active soybean contract on the Chicago Board of Trade Sv1 was up 3-1/4 cents to $11.37-1/4 per bushel as of 10:15 a.m. CST (1615 GMT).

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.

"Funds are still bullish soybeans, and there are hopes China will come in to buy old crop soybeans," said Nathan Losey, an analyst at AgResource. "But that story is a couple weeks old and we haven't seen any new action, so the market might be getting exhausted of the topic."

The Lunar New Year holiday in China this week has tempered hopes of immediate purchases.

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 anticipated quotas kept attention on the prospect for increased blending requirements for biofuel, a major source of demand for soyoil, buoying soyoil futures.

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 level since April 2023, according to monthly National Oilseed Processors Association data issued on Tuesday.

CBOT wheat Wv1 gained 6-1/4 cents to $5.44 a bushel and corn Cv1 was up 3/4 cent to $4.27 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.