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GRAINS-Planting delays, rain forecast spark fresh rally in corn, soy, wheat

(Recasts, updates with U.S. trading, adds new analyst quote, changes byline, dateline; pvs HAMBURG)

CHICAGO, May 28 (Reuters) - U.S. corn futures surged 2.7 percent to their highest levels in nearly two years on Tuesday, supported by planting delays across key growing areas of the U.S. Midwest following heavy rains, traders said.

The adverse weather in the Midwest and Plains also fuelled strong gains in the soybean and wheat markets due to concerns that farmers will be forced to curtail their plantings this spring and worries that flooding damaged the quality of the wheat crop.

“They are not going to get in the fields,” said Michael Seery, president of Seery Futures. “There is no way. These fields are soaking wet. This is an old fashioned weather market. It is all about acres and when the rain will stop.”

At 10:52 a.m. CDT (1552 GMT), Chicago Board of Trade July corn futures were up 11-1/4 cents at $4.15-1/2 a bushel. The most-active contract peaked at $4.15-3/4, its highest since July 11, 2017.

U.S. grains markets were closed on Monday for the Memorial Day holiday and are only now reacting to weekend weather.

“Grain markets jumped higher again as strong, weekend storms continued to pour heavy rains across a large part of the U.S. growing region and threatens to slow an already delayed planting season,” brokerage Allendale said in a note to clients.

Corn futures have risen for 10 of the last 11 trading sessions, gaining 63-3/4 cents as delays across the Midwest have pushed farmers well behind their typical planting schedule. The late planting threatens to cut harvest yields.

The U.S. Department of Agriculture’s (USDA) weekly crop progress report on Tuesday afternoon should show that farmers were able to plant 63 percent of their intended corn acres as of Sunday, according to the average estimate in a survey of 14 analysts. Soybean planting was seen at 31 percent.

The five-year averages for late May are 90 percent for corn and 66 percent for soybeans.

CBOT July soybean futures were up 23 cents at $8.52-3/4 a bushel, with the most-active contract hitting its highest since May 2.

CBOT soft red winter wheat for July delivery was 14-1/2 cents higher at $5.04 a bushel. The most-active contract topped out at its highest since Feb. 14.

Private forecaster Commodity Weather group predicted that most of the Midwest would see minimal breaks in rain during the next 10 days, providing limited opportunity for fields to dry out and farmers to make progress between the showers.

Additional reporting by Julie Ingwersen in Chicago, Naveen Thukral in Singapore and Michael Hogan in Hamburg, editing by Jane Merriman and Susan Thomas