A wheat-related ETF reflected one of the few areas of strength in the markets on Tuesday as wheat futures gained on speculation of large scale U.S. grain purchases with China looking to reopen trade and Russia considering a reduction in wheat exports to stabilize its domestic market.

The Teucrium Wheat Fund (NYSEArca: WEAT) increased 1.0% Tuesday while CBOT wheat futures were flat at $5.175 per bushel.

Supporting early morning gains, traders were optimistic that the U.S.-China trade negotiations were progressing.

“The commodity markets are starting to gear up for the idea that China’s going to open up,” Mike Zuzolo, president of Global Commodity Analytics, told Reuters. “The trade is really gearing up for the idea that these rumors are going to materialize.”

China offered a $1 trillion deal to increase imports from the U.S. in an effort to advance trade negotiations with Washington. The announcement came a day after U.S. Treasury Secretary Steven Mnuchin discussed lifting some or all tariffs on Chinese imports and offered a tariff rollback during trade discussions.

Global wheat futures

Further bolstering global wheat futures, expectations of diminished supply out of Russia could push more global buyers into U.S. markets.

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