GRAINS-Soybeans hold firm on demand optimism

By Naveen Thukral and Gus Trompiz

SINGAPORE/PARIS, Feb 26 (Reuters) - Chicago soybeans extended gains on Thursday to their highest since mid-2024 as expectations of more U.S. biofuel demand and Chinese imports underpinned the market.

Wheat steadied after a three-day fall as the market assessed a wave of importer demand and rumours that cheap Argentine supplies were attracting interest from U.S. buyers.

Grain markets were awaiting weekly U.S. export data later on Thursday for an update on overseas demand. USDA/EST

The most-active soybean contract on the Chicago Board of Trade (CBOT) Sv1 was up 0.5% at $11.71-1/4 a bushel at 1304 GMT. It earlier hit its highest since June 2024 at $11.72-1/2, surpassing a three-month peak from Wednesday.

The end of the Lunar New Year holidays in China, as well as Beijing's measured reaction to new U.S. tariff announcements following a Supreme Court rejection of previous levies, has maintained hopes of more Chinese demand for U.S. soybeans.

"China has returned from New Year celebrations with a renewed appetite across grains and oilseeds," said Josh Lawrence, advisory consultant at agricultural brokerage IKON Commodities in Sydney.

U.S. BIOFUEL PLAN AWAITED

Market expectations of additional U.S. biofuel demand for soybean by-product soybean oil have also underpinned prices.

The U.S. Environmental Protection Agency said on Wednesday it would send its proposal for new biofuel blending mandates to the White House, with an expected rule to be finalised by the end of March.

A Reuters report on Thursday that the U.S. government plans to reallocate at least 50% of exempted biofuel blending obligations to big refiners lent further support, suggesting a higher reallocation level than previously reported.

CBOT soyoil BOv1 was up 0.7%, having turned higher after the report to hit its highest since September 2023.

CBOT wheat Wv1 was up 0.2% at $5.70-3/4 a bushel and CBOT corn added 0.3% to $4.43-1/2 a bushel.

Saudi Arabia's state buyer announced a tender to purchase 655,000 metric tons of wheat. That followed an Algerian tender this week in which the importer bought around 600,000 tons, according to traders. GRA/TEND

Wheat prices had retreated from a three-month peak at the start of the week, with analysts citing pressure from rain forecast in the U.S. Plains and talk that U.S. buyers were looking to import competitively priced Argentine wheat.