CHICAGO (Dow Jones)--U.S. corn futures are expected to open higher Wednesday on end-user buying and optimism about Chinese demand, traders said.

Chicago Board of Trade futures are up 4 to 6 cents. In overnight trade, corn for December delivery was up 4 3/4 cents, or 0.9%, to $5.33 1/4 per bushel

Prices have tumbled from a high of $6.05 earlier this month, but the market rebounded Tuesday as end-users looked to book purchases at the lower prices. Traders said the rally seemed more significant because it came despite strengthening in the U.S. dollar, which normally pressures corn and other commodities.

Firm cash market prices have been underpinning the market, traders add, as many farmers have seen little reason to sell at these prices. Many farmers have already made good profits from the market's surge during the past few months, and they expect a tight supply and demand forecast could ultimately send prices higher again.

"I don't think they're ready to let it out of the bin," said Paul Beere, analyst with Prime Ag Consultants.

He added that some farmers are content to wait until the new year to make any new sales for tax purposes.

Also supporting the market is dry South America weather, which is creating anxiety about the crop there. Argentina, the world's second-largest corn exporter, is of particular concern.

"Their planting window is closing rapidly, so I think there's definitely going to be some acreage reduction," said Don Keeney, meteorologist for MDA EarthSat Weather.

Crop areas are expected to stay dry for the next 10 days, he said.

Signs that China could have a corn shortage is also considered supportive. The China Banking Regulatory Commission on Monday ordered banks to expand loans to the agricultural sector, in a bid to support production and facilitate trading. Analysts say it is the first recognition by the Chinese government that grain shortages loomed.

However, AgResource Co. notes China is also continuing its "near daily jawboning" against speculators. A Wednesday statement from the National Development and Reform Commission was the third in three days about the need to stabilize prices. It said soaring grain prices were the direct result of speculation.

Traders said price action could be thin and choppy Wednesday as many participants take off early ahead of Thursday's Thanksgiving Day holiday. The market will be closed Thursday.

December options expiration is Friday, and the market is stuck between two key strike prices, $5 and $5.50. That could add to the volatile trade, traders said.

(Zhoudong Shangguan and Tom Polansek contributed to this report.)

-By Ian Berry, Dow Jones Newswires; 312-750-4072;