GRAINS-Iran war lifts grains and soybeans; focus on US rain and planting estimates

By Michael Hogan

HAMBURG, March 30 (Reuters) - Chicago soybeans and corn advanced on Monday as concerns over escalation in the Iran conflict, coupled with firmer crude oil prices, supported the market. O/R

Wheat was weakened by forecasts of rain this week in dry U.S. grain belts, while corn was underpinned by expectations the U.S. Department of Agriculture (USDA) would estimate reduced U.S. sowings.

Chicago Board of Trade most-active soybeans Sv1 rose 0.6% to $11.67-1/4 a bushel at 1120 GMT. Wheat Wv1 fell 0.4% to $6.02-1/4 a bushel, corn rose 0.05% to $4.62-1/4 a bushel.

"The Iran war is again supporting wheat, corn and soybeans today, with concern about intensification if Yemen's Houthis get involved," said Matt Ammermann, commodity risk manager at StoneX. "The uncertainty and risk-on mood are generating flows of managed and speculative flows into grains, which is supportive but causing price turbulence."

"The market is assessing conflicting statements, with President Trump saying talks with Iran are underway and Iran denying this. Soybeans are underpinned by expectations of more biofuel use with crude oil prices so high, which would underpin soyoil, with the U.S. announcing such moves on Friday and Indonesia today."

Markets await the release of the USDA's prospective U.S. plantings report on Tuesday, as the Iran war is believed to have changed the planting intentions of U.S. farmers, resulting in fewer acres of corn and the lowest quantity of spring wheat planted since 1970 as rising fertiliser and fuel costs dim profit outlook.

"The U.S. plantings and stocks report on Tuesday could provide surprises, corn is underpinned by expectations of reduced U.S. sowings, but the Iran war has reduced market focus on the report," Ammermann said.

"Wheat is facing downward pressure from forecasts of welcome rain in the U.S. this week, but we will have to see how much actually falls."