US grains: wheat rises, soybeans extend gains

US wheat rose today, gaining for the first time in six sessions, on concerns key producer Russia may curb exports of the drought-hit grain at an agricultural ministry meeting later this week.

Soybeans also extended gains into a second session on export demand from China and corn edged up as damage to crop yields in the US Midwest from the worst drought in more than 50 years continued to underpin prices.

A sharply reduced Russian 2012 grain crop forecast, which the government recently cut to 75 million tonnes, has sparked concerns Moscow might ban exports.

Russia barred grain exports for almost a year in August 2010 after a severe drought. Some market observers have speculated this year Russia's wheat harvest may fall below the crop of 2010, when it brought in 41.5 million tonnes of wheat out of a total grains harvest of 61 million tonnes.

The Russian agriculture ministry said today the country's grain yields had fallen 27 percent from last year to 1.92 tonnes per hectare as of Aug. 28.

Chicago Board Of Trade December wheat rose 1.6 percent to $8.89-1/2 a bushel, after dropping 5 percent over the last five trading sessions. In Europe, benchmark November on the Paris-based European milling wheat futures market was 0.6 percent higher at 262.25 euros ($330) a tonne.

New-crop soybeans rose 0.67 percent to $17.33-3/4 a bushel, having firmed 0.2 percent yesterday, while December corn rose 1.07 percent to $8.04 a bushel after falling 0.7 percent in the previous session.

Soybeans drew support from signs of export demand. Private exporters reported the sale of 110,000 tonnes of US soybeans to China for delivery in the new marketing year, the US Agriculture Department said yesterday.

Traders were also keeping a close watch on the impact of Hurricane Isaac.