GRAINS-Prices pause after rally as traders weigh weather, oil and China

Gus Trompiz and Colin Packham

* Corn ticks lower after two-week high

* Soybeans ease after rally on China hopes

* Crude oil upheaval lends support to corn as ethanol feed

* Fair Midwest weather curbs market ahead of weekly crop data

(Updates with European trading, changes byline/dateline) PARIS/SYDNEY, Sept 16 (Reuters) - Chicago corn futures edged lower on Monday from an earlier two-week high as favourable weather for late-developing Midwest crops offset support from a surge in crude oil prices and signs of easing U.S.-China trade tensions. Soybeans also eased after touching a close to seven-week high, with benign Midwest weather also capping prices and traders awaiting further confirmation of Chinese purchases that triggered a rally last week. Wheat was little changed from the previous session. The most active corn futures contract on the Chicago Board Of Trade was down 0.2% at $3.68 a bushel at 1132 GMT, having touched its highest since Aug. 30 at $3.72-1/2. Analysts said corn drew some support from upheaval in crude oil markets, with Brent futures posting their biggest intraday percentage gain since the start of the Gulf War in 1991. The oil price spike was in response to an attack on Saudi Arabian oil facilities on Saturday, shutting down the equivalent of 5% of global supply. "Corn is an ethanol player. We will see how long those gains hold, but for now the oil rally is underpinning the gains," said Phin Ziebell, agribusiness economist at National Australia Bank. Ethanol fuel is one of the main uses for U.S. corn. However, the market focus remained on yield prospects in the run-up to the U.S. harvest and forecasts for mild Midwest weather were raising expectations that crops planted very late in a soggy spring could still achieve decent yields. "Increasing warmth through the end of September will likely continue to lower frost/freeze risks, and the latest satellite imagery points to overwhelmingly positive late-season conditions in most major agricultural areas," said Refinitiv Agriculture Research analysts of U.S. corn and soybean crops. Grain markets will receive a further indication of field conditions later on Monday from the U.S. Department of Agriculture's (USDA) weekly crop report. CBOT soybean futures were down 0.4% at $8.95-1/4 a bushel, failing to hold the psychological $9 level after touching its highest since July 30 at $9.04-3/4. Soybeans rallied late last week after Chinese importers made a large purchase of U.S. supplies and Beijing's official Xinhua News Agency said that some U.S. agricultural products including soybeans would be exempt from additional tariffs. The USDA on Friday confirmed that Chinese importers had booked 204,000 tonnes, but investors were waiting to see if the rest of a volume of at least 600,000 tonnes reported by traders would also be confirmed. CBOT wheat was up a quarter of a cent at $4.83-3/4 a bushel, having closed little changed on Friday. In exports, traders reported a tender called by Algeria for November shipment, noting it had skipped the expected October period, which could be a signal that the large importer is reducing purchases.

Prices at 1132 GMT

Last Change Pct End Ytd PctMove 2018 MoveCBOT wheat 483.75 0.25 0.05 503.25 -3.87CBOT corn 368.00 -0.75 -0.20 375.00 -1.87CBOT soy 895.25 -3.50 -0.39 895.00 0.03Paris wheat Dec 170.00 -0.25 -0.15 191.25 -11.11Paris maize Nov 163.00 0.25 0.15 175.25 -6.99Paris rape Nov 385.50 2.00 0.52 364.00 5.91WTI crude oil 60.04 5.19 9.46 45.41 32.22Euro/dlr 1.10 0.00 -0.31 1.1469 -3.75

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

(Reporting by Gus Trompiz in Paris and Colin Packham in Sydney Editing by Aditya Soni and David Goodman)