GRAINS-Soy eases after rally, wheat awaits Egypt tender

* Soy eases after biggest daily gain in 2 weeks
* Wheat rises, eyes Egypt tender and Argentine flood damage
* Corn near 2-month low on lower yield cuts
* USDA: Drought impact less than many feared

(Updates prices, adds details)
By Naveen Thukral and Sybille de La Hamaide
SINGAPORE/PARIS, Sept 13 (Reuters) - Chicago soybeans eased
on Thursday as the market took a breather after notching up
their biggest daily gain in about two weeks on tighter supply
forecast by the U.S. Department of Agriculture.
Wheat was firm ahead of a tender in Egypt and supported by
increased concerns of damages caused by flooding in large
grain-producing regions in Argentina.
Corn was stable to slightly higher, but still close to its
2-month low, on a lower-than-expected reduction in estimates for
yields and buffer stocks in a U.S. government report.
Searing droughts in the United States and Russia will
deplete harvests of wheat, corn and soybeans, the USDA said on
Wednesday, but global food supplies were not hurt as badly as
many had feared.
The USDA reduced its estimate of corn used for feed in the
just-ended 2011/12 marketing year (September-August) by 150
million bushels, indicating demand rationing. Corn exports have
tumbled in recent weeks as end-users turn to other suppliers and
alternative feed grains.
The department pegged corn ending stocks next summer at 733
million bushels, above trade estimates for 592 million bushels.
But analysts said they were surprised the USDA did not cut
its estimate of corn's harvested acres, which at 87.36 million
were above trade expectations for 86.2 million.
"I think there is potential that they make a reduction in
harvested acres going forward," said Victor Thianpiriya,
agricultural commodity strategist at ANZ in Singapore.
"I don't think there is enough demand rationing being done
at the moment to justify prices close to $7 a bushel. I think $8
is probably still achievable."
In the European Union, a continuing drought in the eastern
and southern part of the bloc last month caused more damage to
crops, further reducing world supplies, analyst Strategie Grains
said.
Chicago Board of Trade new-crop November soy slid 0.3
percent to $17.40 a bushel by 1038 GMT and December wheat
rose 0.6 percent to $8.95-1/2 a bushel.
December corn was 0.16 percent higher at $7.70-3/4 a
bushel. The front-month contract lost 0.3 percent to
$7.68-3/4 a bushel, not far from Wednesday's two-month low of
$7.61-1/2 a bushel.

TIGHTER SOY SUPPLY
The USDA's closely-watched monthly supply-demand report
estimated this year's corn harvest at 10.727 billion bushels,
down slightly from last month's 10.779 billion estimate, but
above analysts' average estimate of 10.38 billion.
It would be the smallest crop in six years, with the lowest
yield in 17 years at 122.8 bushels per acre.
The report was more bullish for soybean prices as the USDA
cut its estimate of the crop in the world's top grain-exporting
nation.
The USDA pegged the soybean harvest at 2.634 billion
bushels, down from last month's 2.692 billion and below
analysts' average estimate of 2.657 billion. Ending stocks next
summer were projected to be the lowest in nine years at 115
million, unchanged from August's estimate.
Wheat futures could get some price direction from a wheat
tender later on Tuesday by Egypt's main state-run buyer, the
General Authority for Supply Commodities.
That will mark the seventh tender in about a month by the
world's largest wheat importer, which has been scrambling for
supplies as drought cuts the Russian crop and dry weather trims
the crop in Australia.
Russian Deputy Prime Minister Arkady Dvorkovich accused
speculators of spreading false rumours that the country would
ban grain exports this year and repeated his promise that Moscow
would not impose restrictions.
EU wheat futures rose in Paris with benchmark November
up 1.15 percent at 263.75 euros a tonne.
Traders noted the market was increasingly worried about
damage to wheat yields caused by flooding in parts of
Argentina's biggest grains province which could force farmers to
write off some fields altogether.

Prices at 1038 GMT
Product Last Change Pct Move End 2011 Ytd
Pct

CBOT wheat 895.50 5.50 +0.62 671.25 33.41
CBOT corn 770.75 1.25 +0.16 654.75 17.72
CBOT soybeans 1740.25 -5.50 -0.32 1207.75 44.09
Paris wheat 263.75 3.00 +1.15 195.25 35.08
Paris maize 248.25 1.00 +0.40 197.25 25.86
Paris rape 517.50 -1.25 -0.24 421.50 22.78
WTI crude oil 97.20 0.19 +0.20 98.83 -1.65
Euro/dlr 1.29 0.02 +1.58 1.30 -0.39
* CBOT futures prices are in cents per bushel, Paris futures
in euros per tonne, WTI crude oil in dollars per barrel.

(Additional reporting by Valerie Parent; Editing by Andrew
Heavens)