GRAINS-U.S. corn up, soy near 4-week peak after poor rains
* U.S. new-crop corn rebounds, up nearly 2 pct
* Soy hits highest since July 23, wheat follows trend
* Disappointing weekend rains buoy grain prices
(Updates with European markets open)
PARIS/SINGAPORE, Aug 19 (Reuters) - Chicago corn rose nearly 2 percent on Monday, rebounding from steep losses in the last session, while soy climbed to its highest since July 23 as poor rains over the weekend in the U.S. crop belt threatened yields.
Wheat advanced 1 percent, underpinned by the gains in corn and soybean futures.
"There was rain expected over the weekend in some areas of the Midwest but they didn't get anything," said a Melbourne-based agricultural commodities analyst.
"The dry weekend weather supported soy and corn. Wheat followed in sympathy," a French trader added.
Chicago Board of Trade November soybeans rose 1.55 percent to $12.78-3/4 a bushel by 1139 GMT, while December corn added 1.83 percent to $4.71-3/4 a bushel.
Dry weather in parts of the U.S. Midwest prompted worries over supplies as corn and soybean crops undergo their key yield-determining phase. Warmer and drier weather will draw down soil moisture levels for crops which were planted late this year, hurting yields and renewing concerns over global supplies.
Importers are hoping for record U.S. production to ease three years of tight grains and oilseed supplies.
Still, the market sees a better chance of rainfall by later this week in the central and northern U.S. Midwest, which would benefit corn and soybean crops.
Strong demand for U.S. soybeans is providing additional support to the market. Private exporters reported sales of 410,000 tonnes of U.S. soybeans to China and unknown destinations for delivery in the new marketing year, the U.S. Department of Agriculture said.
Large speculators increased their net short position in Chicago Board of Trade corn futures in the week to Aug. 13, regulatory data released on Friday showed.
The Commodity Futures Trading Commission's weekly commitments of traders report also showed that non-commercial traders, a category that includes hedge funds, trimmed their net short position in CBOT wheat and switched to a net long position in soybeans.
CME Group Inc, parent of the CBOT, lowered initial margins for agricultural commodity futures mostly across the board on Friday.
The exchange operator lowered corn futures initial margins for speculators by 25 percent to $2,025 per contract from $2,700. CME cut soybean futures initial margins for speculators by 11.8 percent to $4,050 per contract from $4,590.
The wheat market was mainly supported by gains in corn and soybeans. Spot-month wheat gained 0.95 percent to $6.37 a bushel.
Ukraine's Agriculture Ministry has raised its forecast for grain exports in the 2013/14 July-June season to about 30 million tonnes from a previous outlook of 28 million, a senior ministry official said on Monday.
(Reporting by Naveen Thukral; editing by Jason Neely)