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UPDATE 1-Argentine wheat hit by fungi as rain delays other plantings

* Dry weather next week seen better for corn, soy seeding

* Corn planting stuck in the mud after months of rain

* Grains prices soaring due to dry Russian, US weather

* Consumer nations look to Argentina to bolster food stocks

BUENOS AIRES, Oct 23 (Reuters) - Flooding in Argentina's Pampas grains belt has allowed fungus-based diseases to attack wheat crops already hobbled by scant planting while more wet weather puts off soy and corn seeding until next week, analysts said on Tuesday. Storms have pelted the South American grains powerhouse since August, raising uncertainty about crops needed to bolster food stocks after dry weather slashed output in other major producers such as Russia, Australia and the United States. With the weather forecast unstable for the rest of this week and rains seen at the weekend, climatologists said farmers should wait to restart corn and soy planting. ``This is the third month in a row with excessive rains,'' said German Heinzenknecht, a meteorologist at the Applied Climatology Consultancy. ``The forecast is unstable for the next three days with rains returning to the nucleus of the farm belt over the weekend,'' he said. ``Monday should open a five- to seven-day period of sunshine, so corn and soy farmers should wait at least until Monday to plant.'' Northern and western Buenos Aires province as well as part of Cordoba and Santa Fe have received an average of 50 to 60 millimeters (2 to 2.5 inches) of rain in recent days, Heinzenknecht added.

The U.S. farm belt is coming off its worst drought in half a century and Russia's wheat crop is down more than a quarter from last year. The losses have lit a fire under Chicago grains futures, propelling wheat 32 percent higher since January, while soy and corn have jumped 28 percent and 16 percent, respectively. Argentina's upcoming wheat harvest is expected to shrink 17 percent from last season to 11.5 million tonnes, the Agriculture Ministry said last week, as farmers skirt export curbs by shifting to other crops. ``In the wheat sector, the appearance of diseases has become a worry, and plants have been lost in many areas since their roots were starved of oxygen,'' a Rosario grains exchange report stated. Farmers criticize the state-centric, interventionist policies of President Cristina Fernandez. However, with the United Nations projecting world food demand will double by 2050, investor interest in the sector remains strong. Argentine growers are shying from wheat to avoid export limits that do not apply to the country's main farm export, soy, which will start being planted this month and could be set for a record year as rains enable farmers to widen planting area. The flow of grains from Argentina is important to exporters such as Cargill, Bunge Ltd and Noble Group Ltd , which operate grains terminals along the Parana River, leading to the shipping lanes of the South Atlantic. Unusual weather patterns across central-eastern Argentina, Uruguay and the extreme south of Brazil dumped high volumes of rain in August. At the end of September, showers related to the El Nino phenomenon lashed most of the agricultural bulwark province of Buenos Aires, plus south-central Santa Fe, Entre Rios, Corrientes and Misiones provinces, climatologists say. El Nino, characterized by unusually warm ocean temperatures in the tropical Pacific, often brings rain to the Southern Cone. On the positive side, marginal growing regions such as San Luis, La Pampa, Santiago del Estero and Chaco provinces should get tropical-type weather over the months ahead, giving those areas more productivity potential than they usually have. The U.S. Department of Agriculture sees Argentina's 2012-13 soy output at a record 55 million tonnes, corn at a record 28 million tonnes and wheat at 11.5 million.