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GRAINS-Soy closes higher on rising U.S. stocks, oil prices

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Stocks, oil rallies, pulling up soy from 3-month low

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Ukraine Black Sea grain deal extended for at least 60 days

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Market eyes Fed rate decision on Wednesday

(New throughout; adds closing prices and analyst comment)

MEXICO CITY, March 20 (Reuters) - Chicago Board of Trade soy futures rallied from a three-month low to close higher on Monday, catching a tailwind from U.S. stocks reassured by the announcement that UBS agreed to buy battered rival Credit Suisse, analysts said.

Gains in oil prices also pushed up soybeans, which are used in ethanol and biodiesel production, said Tom Dosdall, a commodities broker at Daniels Trading.

“They’re rallying in sympathy with crude oil,” Dosdall said.

Chicago Board of Trade soybean futures closed up 9-1/2 cents at $14.86 per bushel after hitting $14.62, the contract’s lowest price since Dec. 20.

CBOT wheat settled down 9-3/4 cents at $7.00-3/4 per bushel, while corn settled down 1-1/4 cent at $6.33 per bushel.

Wheat and corn futures fell after a deal to export grains by sea from Ukraine was extended, allowing the flow of crops to global buyers, analysts said.

The deal allowing a safe Black Sea shipping corridor to export Ukrainian grain was renewed on Saturday for at least 60 days, despite hopes for a 120-day extension, after Russia said any further extension beyond mid-May would depend on the removal of some Western sanctions.

Russian President Vladimir Putin said Russia would provide grain to African countries for free if the grain deal is not extended in May.

Traders also had their eyes on whether the Federal Reserve will change its benchmark overnight interest rate on Wednesday, as markets remain on edge in the midst of global banking strains.

“Traders, especially small traders, have run to the sidelines in anticipation of the Fed and its decision and they’ll watch to see how outside markets, the bond market, crude oil and the dollar react,” said Mike Zuzolo, president of Global Commodities Analytics and Consulting. (Reporting by Cassandra Garrison, Michael Hogan in Hamburg, additional reporting by Naveen Thukral in Singapore, editing by Susan Fenton, Paul Simao and Grant McCool)

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