GRAINS-U.S. wheat, soybeans hold firm around 1-year highs on China demand hopes

 (Updates with European trading, changes byline/dateline)
    By Gus Trompiz and Emily Chow
    PARIS/SHANGHAI, Dec 30 (Reuters) - Chicago wheat and soybean
prices rose on Monday to stay near their highest levels in over
a year as traders anticipated China will expand purchases of
U.S. crops under a planned trade deal with Washington.
    Firm physical markets for wheat around the world, supported
by steady export demand, a rally in palm oil prices and dry
weather in South America also lent support to Chicago futures. 
    However, volumes were light in year-end holiday trade and
traders were cautious about the strength of the price rally.
    The most active soybeans futures on the Chicago Board
Of Trade were up 0.7% at $9.48-1/2 a bushel by 1235 GMT, close
to Friday's peak of  $9.50-1/2 that marked an 18-month high.
    CBOT wheat futures were up 1.2% at $5.62-3/4 a bushel,
after earlier setting a new high since August 2018 at $5.63-1/4.
    Corn was unchanged on the day at $3.90 a bushel,
consolidating below a near two-month top of $3.91 struck on
    "Grain markets remain steady to higher as traders hold out
hope of a China trade deal which will boost U.S. grain exports,"
U.S. brokerage Allendale said in a note.
    China, the world's largest consumer of soybeans, and the
United States struck a "phase one" trade deal this month to
defuse a dispute that has disrupted massive U.S. soybean
    The agreement includes a commitment by Beijing to increase
purchases of U.S. agricultural products, although a formal text
has yet to be signed.
    The initial agreement has also raised expectations of
Chinese imports of U.S. corn and wheat, which could add to brisk
international demand for wheat.
    Iran has in recent weeks bought around 1 million tonnes of
wheat, mainly  Russian, according to traders, while Chinese
purchases of European Union wheat this season are also expected
to reach about 1 million tonnes.
    Export prices in Russia, the world's biggest wheat supplier,
rose for a seventh straight week last week.

    Grain markets were also being supported by recent dry
weather in Brazil, the world's biggest soybean exporter.
    "After a week of widespread dryness, mixed weather (is)
expected for Brazil first-crop corn and soybean areas through 
Jan. 8," Refinitiv Agriculture Research analysts said, noting
above-average rainfall expected in the Center West, Southeast
and Northeast, and below-average rainfall in Mato Grosso do Sul
and the South.
    A near three-year high for Malaysian palm oil futures also
lent support to wider oilseed markets including soybeans.
 Prices at 1235 GMT                                              
                              Last  Change   Pct     End  Ytd Pct
                                            Move    2018     Move
  CBOT wheat                562.75    6.50  1.17  503.25    11.82
  CBOT corn                 390.00    0.00  0.00  375.00     4.00
  CBOT soy                  948.50    7.00  0.74  895.00     5.98
  Paris wheat Mar           189.50    0.50  0.26  194.50    -2.57
  Paris maize Jan           168.00    2.50  1.51  175.00    -4.00
  Paris rape Feb            413.50    0.75  0.18  366.00    12.98
  WTI crude oil              62.10    0.38  0.62   45.41    36.75
  Euro/dlr                    1.12    0.00  0.12  1.1469    -2.45
 Most active contracts - Wheat, corn and soy US cents/bushel,
 Paris futures in euros per tonne

 (Reporting by Gus Trompiz in Paris and Emily Chow in Shanghai;
Editing by Subhranshu Sahu and Jason Neely)