* Corn posts steepest jump in 6 months on NAFTA news
* Soybeans touch to 5-1/2-week peak
* Prices anchored by ample supplies
By Karl Plume
CHICAGO, Oct 1 (Reuters) - U.S. corn and soybean futures rallied on Monday, reversing the prior session's steep losses, after the United States, Canada and Mexico announced they had reached a deal on a trilateral pact to replace NAFTA.
Corn gained nearly 3 percent and soybeans more than 1 percent as news of the trade agreement, reached over the weekend, eased concerns that the United States would exit the North American Free Trade Agreement that has propelled U.S. crop export growth for a quarter century.
The trade news outweighed Friday's U.S. Department of Agriculture report that showed larger-than-expected stocks of both commodities. and oil markets also gained and the U.S. dollar climbed as investors assessed the new trade deal, called the U.S.-Mexico-Canada Agreement (USMCA). markets probably expected they would come together and come to agree. So I'm not sure it is a big surprise. But it's favorable news," said Rich Feltes, vice president for research with R.J. O'Brien.
Chicago Board of Trade December corn CZ8 rose 9-1/2 cents, or 2.7 percent, to $3.65-3/4 a bushel in the contract's sharpest gain in six months.
CBOT November soybeans SX8 rallied 12-1/4 cents, or 1.4 percent, to $8.57-3/4 a bushel after earlier touching a 5-1/2 week high.
Wheat futures followed corn and soy higher, although gains were capped by weak export demand. CBOT December wheat WZ8 ended up 1/2 cent at $5.09-1/2 a bushel.
Ample stocks of corn and soybeans and expectations for a massive U.S. harvest remained headwinds for grains, although worries about harvest-stalling rains across the Midwest underpinned prices.
In its quarterly stocks report on Friday, the USDA said soybean inventories stood at 438.1 million bushels as of Sept. 1, an 11-year high. The corn stockpile totaled 2.140 billion bushels, down 7 percent year on year but above expectations.
Soybean supplies have increased as a trade row between Washington and Beijing has slowed U.S. exports to China, the world's top importer of the oilseed. Last week soybean futures neared a 10-year low on worries over the dispute.
The USDA is due to release weekly crop condition ratings and harvest progress estimates after the close on Monday. Analysts, on average, expect corn and soybean conditions to remain stable amid largely favorable Midwest weather.