China, the world's largest soy buyer, imported less soybeans in 2011 than the previous year, the first fall in seven years, as Beijing released a large volume of state reserves last year to cool food inflation.
But analysts expect China to accelerate buying of soybeans this year, to between 56 million and 61 million tons, to fill depleted state reserves.
"As the market is now looking at 2012, what is the outlook for imports in the New Year? Obviously, supplies are tight out of the United States and are becoming tighter out of South America because of the dry weather," Davis said.
"Certainly, if the weather continues to deteriorate the South American crop, they will have to pay a higher price for beans this year. We are looking at 56 million tons of imports in 2012."
European wheat prices eased, reflecting weaker U.S. grains markets and pressured by forecasts of rain showers in Argentina this week although the impact was hard to assess, traders said.
Euronext's benchmark contract March was 1.00 euros or 0.5 percent lower at 200.25 euros a ton by 1255 GMT. It remained within its bullish channel but without breaking its resistance at 202-203 euros a ton, traders said.
"The market is hesitant. It needs to follow something so follows the leading market in Chicago," one Euronext trader said.
The market also noted news that wheat exports from Ukraine were likely to fall 17 percent in the 2012/13 season, to 6.3 million tons, due to a sharp decrease in this year's wheat harvest after a severe drought, according to analyst UkrAgroConsult.
The market is expecting the USDA to slash its estimates for South American corn and soy output in its report on Thursday.
There has also been a debate over whether the USDA had understated corn used for feed in the United States in the 2011/12 season ending Aug. 31.
CBOT wheat has been also supported by short-covering and buying ahead of portfolio rebalancing by index funds this week.
The annual rebalancing of commodity funds was expected to happen over the course of this week.
According to the latest trade estimates, the S&P GSCI and DJ-UBS funds combined may need to buy roughly 28,000 Chicago Board of Trade wheat contracts while selling 26,000 corn.
The funds may also buy 16,000 soyoil contracts, 2,600 Kansas City Board of Trade wheat, and sell 600 CBOT soybean contracts.