GRAINS-Soy, corn rebound as heat dents US crop ratings

Wheat was mixed on Tuesday as traders assessed the seriousness of discussions between Russia and Ukraine to allow cargo ships to travel through their Black Sea ports as fighting between the countries continues.

Investor attention lingered on reports that Ukraine was discussing possible mechanisms to keep vessels moving through its major export ports, raising the prospect of Black Sea exports avoiding a major disruption, despite a Ukrainian denial.

"The wheat market tends to bounce back and forth depending on what headline you're reading," said Jim McCormick, co-founder of AgMarket.net.

Chicago corn and soybeans rose on Tuesday, recouping some of the previous session's losses after a U.S. government report lowered crop ratings following hot and dry weather, shrugging off losses in oil prices.

The most-active corn contract on the Chicago Board of Trade gained 6-1/2 cents to $4.80-1/2 a bushel, while soybeans rose 5-3/4 cents to $12.19-1/2 a bushel.

Wheat futures traded near even as market players tried to assess the prospects for negotiations between Russia and Ukraine to keep cargo ships moving through the Black Sea.

Wheat fell 1/4 cent to $6.59-3/4 a bushel.

The U.S. Department of Agriculture said after the market closed on Monday that 63% of the country's corn crop was rated in good-to-excellent condition as of Sunday, down from 67% a week earlier. Ratings for soybeans declined to 63%, from 66% a week earlier, it said. Ratings for both crops were below the average analyst estimate.

Oil prices dropped 5% on Tuesday to a two-week low, on cautious hopes for a resolution to the U.S. war on Iran as traders assessed developments in the Middle East.