Soy hits eight-month high as rains disrupt Argentina's harvest

U.S. soybean futures rose to their highest level in eight months on Monday, as heavy rains in Argentina heightened fears of crop damage while corn rose on concerns over dry weather in Brazil.

Wheat futures showed mixed trends with European prices weighed on by high stocks and a favorable crop outlook.

Chicago Board of Trade most-active May soybeans rose 0.7 percent to $9.62-3/4 a bushel by 1101 GMT. Earlier in the session, it jumped to $9.64, the highest level since August.

"Argentina's key production areas have received too much rain of late, with more on the way. That has caused delays both in the field and at port," Commonwealth Bank of Australia analyst Tobin Gorey said.

"Speculation is also mounting over how much of the crop could be damaged as a result."

Dealers said crop problems in South America had influenced fund buying with Commodity Futures Trading Commission data on Friday showing speculators raising a net long position in CBOT soybeans.

"There could be additional demand for U.S. beans as South American exporters had been quite aggressive in soybean exports with currency depreciation in Brazil and reduction in Argentina's export taxes," said Phin Ziebell, agribusiness economist at National Australia Bank.

CBOT May wheat rose 1.1 percent to $4.64-3/4 a bushel while May wheat in Paris fell 0.3 percent to 150.75 euros a tonne.

Dealers said prices in Paris were weighed on by large inventories and a favorable crop outlook with the FranceAgriMer farm office on Friday rating 92 percent of soft wheat in good or excellent condition.

French consultancy Agritel also increased its forecast on Monday for 2016 wheat production in major exporter Ukraine to 19.3 million tonnes, after favorable weather and spring sowing improved harvest prospects following a poor start to the growing season.

CBOT corn prices edged higher with the most active May contract up 0.2 percent at $3.79-1/4 a bushel.

Recent gains in corn have been driven by dryness in Brazil and forecasts for the emergence of the La Nina weather event.

Brazil's winter corn crop is being stressed by dry conditions. The Commodity Weather Group said in a note to clients that "minimal rains over the next 10 days allow stress to expand to nearly half of the belt."

The U.S. Climate Prediction Center has forecast an increasing chance of La Nina in the second half of the year. Its arrival could raise the risk of hotter and drier weather in the Midwest corn belt.