GRAINS-Corn extends gains, set for biggest weekly rise in 4 months

* Corn market “enjoying a renaissance” with gains -analyst

* Rally expected to fade due to beneficial crop weather

* Wheat advances as traders cover short positions (Updates with U.S. trading; changes byline, dateline, previous SYDNEY/LONDON)

By Tom Polansek

CHICAGO, Aug 15 (Reuters) – U.S. new-crop corn futures rose on Friday and looked poised to record the biggest weekly gain in four months as a lower-than-expected official crop forecast supported prices.

Soybean futures slipped, while wheat advanced.

Corn was poised to record a weekly gain of nearly 2.5 percent, the biggest rally since April 4, drawing support from lower-than-expected U.S. production and yield estimates issued by the U.S. Department of Agriculture on Tuesday.

“Corn is enjoying a renaissance this week,” said Sterling Smith, futures specialist at Citi in Chicago. “The slow summertime activity, combined with the USDA’s modest hike in yields, is giving the market a brief boost.”

Chicago Board of Trade December corn futures were up 4-1/4 cents at $3.77-3/4 a bushel at 11 a.m. CDT (1600 GMT). The new-crop contract has advanced for four consecutive sessions this week for the first time since Feb. 12.

The gains will likely be short-lived, however, because U.S. farmers are projected to harvest a record crop, traders said. Many analysts expect the USDA to increase its official yield estimate in the coming months due to favorable crop weather.

The USDA, in a monthly report on Tuesday, put the U.S. corn harvest at a record 14.032 billion bushels, below analysts’ consensus estimate of 14.253 billion, and the soybean crop at a record 3.82 billion bushels.

November soybeans futures fell 3 cents to $10.53 a bushel. Soybeans hit a contract low in the previous session before closing up slightly.

December wheat futures rose 11 cents to $5.63-3/4 a bushel.

“Wheat is finding strength along with the rest of the grain space as some short-covering is being seen lifting values in quiet trade,” Smith said.

Prices at 10:57 a.m. CDT (1557 GMT)                          
 
                              LAST      NET    PCT     YTD
                                        CHG    CHG     CHG
 CBOT corn                  366.50     4.50   1.2%  -13.2%
 CBOT soy                  1095.75    -2.50  -0.2%  -16.5%
 CBOT meal                  384.60     2.20   0.6%  -12.1%
 CBOT soyoil                 33.01    -0.50  -1.5%  -15.0%
 CBOT wheat                 548.75    11.50   2.1%   -9.3%
 CBOT rice                 1279.50    -6.00  -0.5%  -17.5%
 EU wheat                   173.00     2.25   1.3%  -17.2%
 
 US crude                    96.69      1.1   1.2%   -1.8%
 Dow Jones                  16,584     -130  -0.8%    0.0%
 Gold                      1307.84    -4.90  -0.4%    8.5%
 Euro/dollar                1.3390   0.0028   0.2%   -1.9%
 Dollar Index              81.4540  -0.1340  -0.2%    1.8%
 Baltic Freight               1015       73   7.8%  -55.4%
 
    

 (Additional reporting by Colin Packham in Sydney and Sarah
McFarlane in London; Editing by William Hardy and Peter
Galloway)

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