GRAINS-Corn, wheat up 4 pct as funds buy, dollar falls

* New fund money lifts grains/soy

* Weak dollar boosts corn, soy and wheat

* Firm crude oil also lends support to grains

* Better harvest weather limits rise

(Updates to include close of U.S. trading session, fresh analyst quotes)

CHICAGO, Nov 2 - U.S. corn and wheat futures rallied over 4 percent and soybeans gained nearly 2 percent on Monday due to a bout of new fund buying at the beginning of the month and a tumbling dollar as crude oil rose.

The fund buying, plunging dollar and rally in crude oil overrode the perceptions of a bearish market stemming from improved harvesting weather in the United States.

"The dollar dropped and crude oil gained. That's all they're talking about. Harvest weather is better but some of that was factored in the market during last week's drop," said Paul Haugens, vice president Newedge USA.

A weaker dollar tends to support U.S.-denominated commodities by making them cheaper for holders of other currencies, while the price of oil influences grains because of their use in alternative fuels.

U.S. soy for November delivery was up 19-1/2 cents per bushel at $9.97-1/2, December delivery corn was up 16-1/4 at $3.82-1/4 and wheat for December delivery was up 22-1/2 at $5.16-3/4.

Soybean and corn prices had been finding support from excessive wet weather that was stalling harvest and threatening to harm some of the crop but the weather outlooks have turned to a more harvest-friendly picture.

"It's not a bad forecast at all, carrying the idea from last week that we were going to start out the month of November with some of the best harvest weather we've had all season," said Mike Palmerino, meteorologist for DTN Meteorlogix weather.

Traders have been banking on the United States to produce a record soybean crop and the second largest corn crop ever this year and the harvest slowdowns had been keeping a firm floor under prices.

"The next 10 to 14 days in the Midwest Corn Belt, we are going to see fairly clear skies and pretty limited rainfall, which will be definitely conducive to farmers getting their crops harvested," said Toby Hassall, an analyst with Commodity Warrants Australia.

The bearish impact of the change this week to drier harvest weather was in a tug of war with the bullish influence of the tumbling dollar, traders and analysts said.

The falling dollar won the war on Monday.

"We'll stay focused laser-like on the dollar and weather," said Vic Lespinasse, analyst for GrainAnalyst.com.

CBOT settlement prices

Last Change Pct 2008 YTD

Chg Close Pct Chg --------------------------------------------------------------- CBOT corn Cc1> 3.8225 0.1625 4.4 4.07 -6.1 CBOT soy Sc1> 9.9750 0.1950 2.0 9.7225 2.6 CBOT meal SMc1> 302.70 5.70 1.9 300.5 0.7 CBOT soyoil BOc1> 0.3679 0.0039 1.1 0.3329 10.5 CBOT wheat Wc1> 5.1675 0.2250 4.6 6.1075 -15.4 CBOT rice RRc1> 14.7900 0.4300 3.0 15.34 -3.6 EU wheat BL2c1> 127.00 0.25 0.2 137 -7.3 US crude CLc1> 78.06 1.06 1.4 44.60 75.0 Dow Jones .DJI> 9772 59 0.6 8776 11.3 Gold XAU=> 1056.65 12.25 1.2 878.20 20.3 Euro/dollar EUR=> 1.4766 0.0052 0.4 1.3978 5.6 Dollar Index .DXY> 76.2230 -0.0770 -0.1 81.1510 -6.1 Baltic Freight .BADI> 3185 82 2.6 774 311 ---------------------------------------------------------------- *In U.S. dollars, front-month contracts, except EU wheat, which is in euros, CBOT wheat, corn and soybeans per bushel, rice per hundredweight, soymeal per ton and soyoil per lb. (Reporting by Sam Nelson; Editing by Marguerita Choy) (additional reporting by Julie Ingwersen in Chicago, Naveen Thukral in Singapore and Gus Trompiz in Paris)(