GRAINS-Corn eases after May rain rally as weather, tariffs weighed

Gus Trompiz and Naveen Thukral

* Corn, wheat ease after latest surge on Thursday

* Corn up 19% in May, most in a month since June 2015

* Wheat up 18% so far this month, biggest since June 2017

* Rain causing record corn planting delays, may damage wheat

* Market weighs Trump tariff threat vs Mexico, eyes export data

(Updates with European trading, changes byline/dateline) PARIS/SINGAPORE, May 31 (Reuters) - Chicago corn futures fell 1% on Friday but remained set for their biggest monthly gain since 2015 as historic U.S. planting delays due to incessant rain gripped the cereal market. Wheat also eased but was poised for its biggest monthly rally in two years after tracking corn and also finding its own impetus due to potential rain damage to maturing winter wheat. A pause in the rally was sparked by uncertainty created by U.S. President Donald Trump's threat of tariffs against Mexico, usually the largest buyer of U.S. corn, in response to illegal immigration across the U.S. border. Investors were assessing weather forecasts, while end of month positioning and the run-up to weekly U.S. grain export data at 1230 GMT further contributed to subdued overnight trading in Chicago futures, analysts said. The most-active corn contract on the Chicago Board of Trade was down 1.1% at $4.31-1/2 a bushel at 1041 GMT, but were up 19% over May, the biggest rose since June 2015. On Wednesday, it hit its highest since June 2016 at $4.38. "Geopolitics is also back to centre stage with tensions between the U.S. and Mexico caused by immigration," crop consultancy Agritel said. "Weather conditions are improving a bit on the very short end, but forecasts are predicting further rains next week." President Trump said on Thursday he will impose a tariff on all goods coming from Mexico starting at 5% and ratcheting higher until the flow of illegal migrants ceases. However, the consequences of massive planting delays in the U.S. Midwest remained the main focus of grain markets. The International Grains Council on Thursday cut its forecast for world corn output in 2019/2020, as it lowered its U.S. crop estimate. "Corn has a real story and we estimate 35 million tonnes of losses in the United States because of planting delays and yield losses," said Ole Houe, director of advisory services at brokerage IKON Commodities. CBOT wheat was down 1.4% at $5.07-1/2 a bushel. Over the month, it was showing a gain of over 18%, the most since June 2017. CBOT soybeans were down 0.4% at $8.85-1/4 a bushel. Over May, the contract was up 3.7%, which would be a first monthly gain since January. The soybean market had been curbed by setbacks in U.S.-Chinese trade talks and the idea that farmers would shift acreage from corn to later-planted soy. But the unrelenting rain was raising the threat of area and yield losses for soybeans too.

Prices at 1041 GMT

Last Change Pct End Ytd PctMove 2018 MoveCBOT wheat 507.50 -7.00 -1.36 503.25 0.84CBOT corn 431.50 -4.75 -1.09 375.00 15.07CBOT soy 885.25 -3.75 -0.42 895.00 -1.09Paris wheat Sep 184.50 -0.75 -0.40 190.50 -3.15Paris maize Jun 165.00 -1.50 -0.90 184.50 -10.57Paris rape Aug 370.75 -1.25 -0.34 362.25 2.35WTI crude oil 55.42 -1.17 -2.07 45.41 22.04Euro/dlr 1.12 0.00 0.20 1.1469 -2.76

Most active contracts - Wheat, corn and soy US cents/bushel, Paris futures in euros per tonne

(Reporting by Naveen Thukral in Singapoare and Gus Trompiz in Paris, editing by Sherry Jacob-Phillips and David Evans)