By Tom Polansek
    Of DOW JONES NEWSWIRES
 
 
   CHICAGO (Dow Jones)--Chicago Board of Trade soybean futures tumbled Tuesday
 on talk that China had canceled purchases of U.S. soybeans, although there was
 no confirmation of the chatter.
 
   July soybeans closed down 14 cents at $9.83 a bushel, and November soybeans
 closed down 4 1/2 cents at $9. July soymeal closed down $2.30 at $304 per short
 ton, while July soyoil closed down 65 points at 35.19 cents per pound.
 
   There were rumors that Chinese importers backed away from purchases, possibly
 of four to five cargoes of soybeans, a CBOT floor trader said. Crush margins
 have "collapsed" in China following aggressive buying of soybeans, a CBOT floor
 analyst said.
 
   "I think it's about the demand really," said Don Roose, president of U.S.
 Commodities. "Soybeans have been a strong, stellar performer, with demand
 constantly under the market."
 
   Traders looking to avoid risk and take money off the table unwound bull
 spreads, Roose said. There was liquidation of long July/short November spreads
 following weeks of bull spreading, traders said.
 
   Forecasts for wet weather in the central U.S. inspired speculation that
 delayed U.S. corn planting could lead to a shift in acres to soybeans, which
 would be particularly bearish for the new crop. However, Tuesday's slump was
 led by old-crop contracts.
 
   "You've got bear spreads working," Roose said. "With the wet weather, you
 would think the new crop would not be leading the way up. I think it's really
 all about demand."
 
   Weekly U.S. soybean export inspections reported Monday of 6.944 million
 bushels were weak and below expectations, a CBOT floor trader said. Trading was
 dominated Monday by bearish fears that an outbreak of swine flu would reduce
 pork consumption and animal feed demand.
 
   The setback in nearby soybean futures came ahead of first-notice day for May
 futures contracts Thursday. First-notice day is the first day on which notices
 of intention to deliver actual commodities against futures-market positions can
 be received. Nearby May soybeans ended down 15 1/4 cents at $9.89 1/2.
 
   Commodity funds sold an estimated 4,000 contracts.
 
 
   Soy Products
 
   CBOT soy product futures finished lower with soybeans. Bearish chatter about
 weakened export demand for U.S. soy weighed on the complex, traders say.
 Weakness in crude oil added pressure to soyoil, a trader said.
 
   Commodity funds sold an estimated 2,000 contracts of soyoil and were seen as
 even in soymeal.