(Recasts to include U.S. trading session, fresh analyst
quotes, changes dateline from LONDON/SINGAPORE)

By Sam Nelson

CHICAGO, Aug 27 (Reuters) - U.S. corn futures gained 1
percent on Friday and soy held firm on reports of
lower-than-expected yields in the early U.S. harvest and on
brisk export sales of each.

Wheat was up, supported by increased U.S. exports due to
global weather problems including drought in the Black Sea crop
belt, excessive wet weather in Germany and flood-ravaged
cropland in Pakistan.

"Fundamentally we're adding risk premium in corn and beans
because of the lower yield reports," said Don Roose, analyst
and president of U.S. Commodities, Des Moines, Iowa.

In addition, traders are now more interested in buying U.S.
wheat since its discount to EU wheat <BL2c1> widened to $1 per
bushel after the two contracts traded in lock-step for most of
the summer. (Graphic http://link.reuters.com/bed77n)

"U.S. wheat is at a discount now so that's supportive. U.S.
wheat has broken about $2 per bushel from the high in early
August while European wheat is down only 60 cents," Roose
said.

For the week, CBOT wheat is down 2.5 percent, corn about
flat and soybeans up 0.7 percent. So far in August, CBOT wheat
is down 0.15 percent, corn up 7 percent and soy down 3.4
percent.

At 9:59 a.m. CDT (1459 GMT), CBOT September wheat <WU0> was
up 6 cents per bushel at $6.62-1/2, September corn <CU0> up 5
cents at $4.21-1/2, and September soybeans <SU0> up 4-1/4 at
$10.17-1/4.

Wheat traders were watching the export market shrinking
further with the sharp decline in shipments from the Black Sea
region compounded by news that Pakistan was likely to scrap
plans to sell supplies.

A drought has severely dented the export outlook for the
Black Sea region while devastating floods washed away stored
grain in Pakistan and are likely to lead to plans to sell 2
million tonnes of wheat being scrapped. [ID:nSGE67P0M0]

"I think it was largely expected by the market, given the
recent weather events and the flooding," said Doug Whitehead, a
commodities analyst at Rabobank in London.

"But in that regard it is taking another 2 million tonnes
out of the export market, which just increases the burden that
the traditional exporters like the U.S., Australia and the EU
are going to have to deal with."

Analysts said, however, the market's main focus remained on
the Black Sea region.

"A reduction of 2 million tonnes from the international
market is unlikely to affect global balances as much as
Russia's estimated 12 million tonne reduction of exports
(according to USDA forecasts)," Barclays Capital said in a note
on Friday.

Ukraine's grain exports fell to about 2.0 million tonnes in
July-August, the two first months of the new 2010/11 season,
from about 4.0 million in the same period a year earlier, a
farm ministry official said on Friday. [ID:nLDE67Q0Q6]

The outlook in neighbouring Russia, the world's third
largest wheat exporter last season, is even bleaker with
analysts SovEcon saying on Thursday that imports of up to 6
million tonnes of grain may be needed in the current season.
[ID:nLDE67P0XT]

Russia's Agriculture Minister Yelena Skrynnik said on
Friday that the drought-hit country had bigger grain carryover
stocks than previously estimated and could avoid grain imports,
although analysts doubt it. [ID:nLDE67Q09X]

Corn prices also advanced as strong global demand and
concerns over the size of the U.S. crop supported the market.

"There is a sign of inherent strength in corn and more
upside appears to be coming that way," said Alan Plaugmann,
deputy head of CFD's and Listed Products for Saxo Bank.

Prices at 9:56 a.m. CDT (1456 GMT)

LAST NET PCT YTD

CHG CHG CHG
CBOT corn <Cc1> 421.00 4.50 1.1% 1.6%
CBOT soy <Sc1> 1017.00 4.00 0.4% -2.2%
CBOT meal <SMc1> 305.50 -0.80 -0.3% -2.7%
CBOT soyoil <BOc1> 39.80 0.31 0.8% -1.4%
CBOT wheat <Wc1> 660.75 4.25 0.7% 22.0%
CBOT rice <RRc1> 1136.50 2.00 0.2% -22.0%
EU wheat <BL2X0> 219.25 3.00 1.4% 67.4%

US crude <CLc1> 73.19 -0.17 -0.2% -7.8%
Dow Jones <.DJI> 10,029 43 0.4% -3.8%
Gold <XAU=> 1240.10 5.16 0.4% 13.1%
Euro/dollar <EUR=> 1.2710 -0.0003 0.0% -11.2%
Dollar Index <.DXY> 83.0140 0.0800 0.1% 6.6%
Baltic Freight <.BADI> 2712 9 0.3% -9.8%

* In U.S. cents, benchmark contracts, except EU wheat
euros) and soymeal (dollars). CBOT wheat, corn and soybeans per
bushel, rice per hundredweight, soymeal per ton and soyoil per
lb.
(Reporting by Sam Nelson; additional reporting by Nigel Hunt
in London and Naveen Thukral in Singapore; Editing by Lisa
Shumaker)