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Markets wait for China news

The soybean market is waiting for news of more purchases by China.

Market analyst Arlan Suderman, chief commodities economist with INTL FCStone, says there are rumors of another two million metric tons to be purchased by the Chinese.

“At this point, that probably would not be enough to really materially move the market,” Suderman says. “It’s certainly positive, but not enough to make a big dent, with the expectation that the bulk of China’s purchases are probably going to go south of the Equator here in the weeks ahead with the new crop harvest already started in parts of Brazil.”

There are also rumors China in preparing to buy U.S. corn. Suderman says it would make sense for the Chinese to do that.

“The math does work for them,” he says. “The Chinese government could make money right now on buying U.S. corn at the Gulf, freighting it over, blending it with their lower quality 2015 supplies that are in their reserve, and selling it at open auction.”

That could have a very positive impact on the corn market, Suderman says.

“The question is, will they do that and what’s the timing. There have been some rumors that they could start buying corn in the month of January.”

There’s also talk that China is getting ready to purchase U.S. ethanol, he says.

AUDIO: Arlan Suderman