GRAINS-Wheat hits 1-month top on firm cash markets; soybeans decline

Julie Ingwersen

(Updates prices, adds analyst comments, changes dateline from PARIS/SINGAPORE)

CHICAGO, Nov 25 (Reuters) - U.S. wheat futures climbed to a one-month high on Monday on firm domestic cash values and signs of rising global cash prices, traders said.

Corn futures followed wheat higher but soybean futures fell, with the benchmark January contract hitting its lowest level in more than two months.

As of 12:57 p.m. CST (1857 GMT), Chicago Board of Trade December wheat was up 14-1/2 cents at $5.29-3/4 a bushel after reaching $5.32-1/2, its highest price since Oct. 21.

CBOT December corn was up 1-1/4 cents at $3.70 a bushel while January soybeans were down 4-1/2 cents at $8.92-1/2 a bushel, the contract's lowest level since Sept. 12.

Wheat futures rose on a mix of fund-driven short covering and bullish fundamentals including rising cash values for U.S. and Russian supplies, wet weather in Europe and fears of a decline in U.S. acreage.

"It started with short covering. But the cash market in (U.S.) soft wheat is on fire," said Roy Huckabay with Linn & Associates, a Chicago brokerage. "I think you've got issues in Europe too, with wet conditions preventing plantings."

Heavy rain is expected to reduce winter cereal sowings in parts of Western Europe, the European Union's crop monitoring unit, MARS, said on Monday.

Ahead of the U.S. Department of Agriculture's weekly crop progress report, analysts surveyed by Reuters on average expected the government to rate 51% of the U.S. winter wheat crop in good to excellent condition, down from 52% a week ago.

Meanwhile, Russian wheat prices recorded a second consecutive weekly rise last week amid higher export demand and lower domestic supply caused by concerns about the 2020 crop in Russia and Ukraine, analysts said.

Traders were also monitoring a strike at Canada's largest railroad, Canadian National Railway Co, which entered its seventh day. An association of Canadian exporters declared an event of delay, allowing members to avoid contract penalties due to circumstances outside their control.

CBOT soybean futures fell as uncertainty about U.S.-China trade talks and improving South American crop weather overshadowed strong weekly U.S. export inspections.

The USDA reported export inspections of U.S. soybeans in the latest week at 1,942,761 tonnes, the highest weekly total in two years.

U.S. trade talks with China, a key market for U.S. agricultural goods, especially soybeans, remained a key focus.

China and the United States are "moving closer to agreeing" on a "phase one" trade deal, the Global Times, a tabloid run by the ruling Communist Party's official People's Daily, reported on Sunday. But the report noted that Washington and Beijing had not agreed on specifics or size of tariff rollbacks on Chinese goods.

"I don't think the negotiations on the trade deal are going very well," Huckabay said.

(Reporting by Julie Ingwersen in Chicago Additional reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore Editing by Pravin Char and Matthew Lewis)