GRAINS-Chicago grains trim earlier gains as markets eye Fed decision

By Cassandra Garrison

MEXICO CITY, March 21 (Reuters) - Chicago wheat, corn and soy futures trimmed gains on Tuesday, as markets kept a cautious eye toward the U.S. Federal Reserve policy decision this week.

Wheat and corn continued to be capped by the extension of a Black Sea export corridor from war-torn Ukraine, while an improvement in wheat conditions in some U.S. states and rain expected in drought-hit Argentina also curbed grain prices.

The most-active wheat contract on the Chicago Board of Trade (CBOT) Wv1 was down 1.86% to $6.87-3/4 at 1047 CDT (1547 GMT).

CBOT corn Cv1 was down 0.16% to $6.32 a bushel. Soybeans Sv1 were bouncy, but edged lower 0.02% to $14.85-3/4 a bushel.

The dollar eased while share prices rose as markets welcomed emergency banking measures, including a rescue of Credit Suisse, and hoped the U.S. Federal Reserve would take a less aggressive line in an interest rate announcement on Wednesday. MKTS/GLOB

"I think everybody's just taking a low profile until they get some kind of an indication of what the Feds is going to do with their policy," said Dale Durchholz, commodity analyst at Grain Cycles.

Soybeans, used in ethanol and biodiesel, dipped after going higher earlier as oil prices continued to rise, extending a recovery from a 15-month low hit the previous day.

Markets still had some doubts about the Black Sea grains corridor, traders said, which despite an extension, had a lingering disagreement between Moscow and Kyiv over the deal's renewal period.

Grain markets were also monitoring harvest prospects.

Ukraine's 2023 grain harvest is likely to fall to 44.3 million tonnes from 53.1 million in 2022 as less acreage is sown due to Russia's invasion, a forecast by the Ukrainian agriculture ministry showed on Monday.

(Reporting by Cassandra Garrison in Mexico City, Gus Trompiz in Paris and Naveen Thukral in Singapore; Editing by Subhranshu Sahu, Susan Fenton and Jonathan Oatis)

((gus.trompiz@thomsonreuters.com; +33 1 49 49 52 18; Reuters Messaging: gus.trompiz.thomsonreuters.com@reuters.net))

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