Recasts with closing market activity and USDA crop progress

By P.J. Huffstutter and Julie Ingwersen

CHICAGO, June 15 (Reuters) - U.S. corn futures closed higher on Monday on a round of bargain-buying, overcoming early weakness tied to tumbling crude oil prices and benign Midwest crop weather, traders said.

Commodities were down broadly in early moves, pressured by news that the U.S. and Iran struck a preliminary agreement to end the Middle East war and reopen the Strait of Hormuz. U.S. crude oil CLc1 futures slid nearly 5%. O/R

But grains rebounded, with soybeans and wheat bouncing off multi-month lows along with corn.

On the Chicago Board of Trade, July corn CN26 settled up 2-3/4 cents at $4.15-1/2 per bushel, after a dip to $4.06-3/4, a life-of-contract low and the cheapest price on a continuous chart of the most-active contract Cv1 since last August.

CBOT July soybeans SN26 ended 5-3/4 cents higher at $11.19-1/4 a bushel and July wheat WN26 finished up 5-1/4 cents at $5.89-3/4 a bushel, after both commodities fell to their lowest levels since February.

All three grain markets have been under pressure for most of June as crops in the U.S. Corn Belt have gotten off to a good start. Managed commodity funds have slashed their net long position in CBOT soybeans since mid-May and flipped to a small net short in CBOT corn, data from the U.S. Commodity Futures Trading Commission showed.

After the CBOT close, the U.S. Department of Agriculture rated 68% of the nation's corn and 66% of soybeans in good-to-excellent condition, each up 1 percentage point from a week earlier. Spring wheat was rated 55% good-to-excellent, up 3 percentage points from last week.

Ratings for the winter wheat crop improved but remained near historical lows, reflecting drought in the Southern Plains. The winter wheat harvest was 25% complete, ahead of the five-year average of 13%.

On the export front, Algeria's state grains agency, OAIC, issued an international tender to buy milling wheat, European traders said, with offers due on Wednesday.

The National Oilseed Processors Association (NOPA) said its members crushed 208.785 million bushels of soybeans in May, down 1.4% from April and below nearly all trade estimates. Soyoil stocks held by NOPA members hit a five-month low at 1.735 billion pounds, below all trade estimates, a factor that supported front-month CBOT July BON26 soyoil futures.

Developments in Iran and efforts to reopen the blockaded Strait of Hormuz remained in the spotlight. Market analysts noted that even if the passage is reopened this week, it will take time for commodity flows to resume their normal pace.

"There is a big difference between opening the Strait, and restoring oil and fertilizer flows to prewar levels," Arlan Suderman, chief commodities economist at StoneX, wrote in an analyst note on Monday.