(Adds details and updates prices)

CANBERRA, April 19 (Reuters) - Chicago wheat futures

rose more than 2% on Friday while soybeans and corn also gained

after reports of Israeli missile strikes in Iran fuelled fears

of an escalating conflict in the Middle East and lifted oil

prices.

Still, all three contracts were hovering close to their

lowest levels since 2020 amid plentiful supply.

The most-active wheat contract on the Chicago Board of Trade

(CBOT) was up 2.1% at $5.64-1/4 a bushel, as of 0445 GMT,

having risen nearly 4% after the first reports of the strike

emerged.

CBOT corn was 0.9% higher at $4.40 a bushel and

soybeans were up 0.4% at $11.54 a bushel.

Oil prices surged more than 4% amid concerns that

Middle East oil supply could be disrupted before easing back to

a gain of around 2%. Gold prices rose, while Asian shares and

bond yields sank.

Traders feared that expanding violence in the Middle East

could impact shipments in the region and from Russia, the

world's biggest wheat exporter and an ally of Iran, said

Commonwealth Bank analyst Dennis Voznesenski.

Higher oil prices exert upward pressure on ethanol and its

feedstocks, which include corn and soybeans, Voznesenski said.

Israel had promised to retaliate after Iran last weekend

launched hundreds of drones and missiles on Israel. That attack

was a response to a suspected Israeli strike on Iran's embassy

compound in Syria.

While wheat was set for a weekly gain of around 1.2% and

corn for a weekly rise of about 1%, soybeans remained on track

to end the week down 1.7%.

Prices are under pressure from strong supply of wheat from

Russia, soybeans from South America and corn from South America

and the United States.

The U.S. dollar this week rose to its strongest against a

basket of major currencies since November, making U.S. farm

exports less competitive.

U.S. soybeans are being out-competed by beans from top

producer Brazil, and a plunge in the value of the Brazilian real

has triggered a rush of sales by farmers there.

In other crops, the International Grains Council cut its

outlook for 2024/25 global corn production by 7 million tons to

1.226 billion tons and for wheat production by 1 million tons to

798 million tons, though both estimates are still increases from

the previous season.

Traders are monitoring leafhopper insect plague in

Argentina's corn fields and dry weather in portions of the U.S.

wheat belt, which could tighten supply.