GRAINS-Wheat holds gains as supply worries build

* CBOT wheat near 2-week high after 7-session rally

* Concerns over poor U.S., southern hemisphere conditions

* Weekly U.S., EU exports to offer fresh demand test

* Grains buoyed by investor hopes on U.S. budget deal

(Updates with European trading, changes quotes, dateline) PARIS/NEW DELHI, Nov 29 (Reuters) - U.S. wheat futures inched higher on Thursday, putting the market on course for an eighth straight daily rise as concerns continued to grow over weather disruption to supply among the world's major exporters. Dry growing conditions in the United States and rain-hampered harvests in Argentina and Australia have added tension to the wheat market after poor crops in the Black Sea region. Corn and soybean futures also edged higher as crop markets drew support from investor hopes a political deal will be reached to avert a fiscal crisis in the United States.

Chicago Board Of Trade December wheat was up 0.1 percent to $8.76-3/4 by 1155 GMT, to stay close to a two-week high hit on Wednesday when the market notched up a seventh consecutive session of gains. December corn added 0.2 percent to $7.61-3/4 a bushel, while January soybeans rose 0.6 percent to $14.55-1/4. "Wheat prices are being lifted by the tightening of supply in the Black Sea region, which is likely to spark higher demand for U.S. and EU wheat," Commerzbank analysts said. "What is more, winter wheat plants in the U.S. are in very poor condition." Rain-affected wheat harvests in South America have also opened up export opportunities, with a major milling group in Brazil predicting the country would import about 1 million tonnes from the northern hemisphere. Weekly U.S. and European Union export data on Thursday will offer gauge of the extent to which the origins are sweeping up demand as competition slackens from other countries. European operators were also watching for the results of a tender by north African importer Algeria, which could bring a fresh sale for French wheat. On the Paris futures market, January milling wheat was up 0.1 percent at 276.25 euros a tonne. It earlier touched a near three-week high at 277.00 euros, close to a contract high of 279.25 euros.

WHEAT PRICES TO GO HIGHER Analysts expect prices to remain firm in the coming months until the next round of crops eases tight stocks. Rabobank analysts forecast that CBOT wheat prices would rise to $9.10 in the first quarter of 2013, before falling to $7 by the fourth quarter. Paris wheat was projected to climb to 290 euros ($370) in the first quarter and then pull back to 204 euros in the fourth quarter. U.S. crop conditions are now raising fears that supply may not recover in 2013. On Monday, the U.S. Agriculture Department (USDA) said winter wheat crops were in the worst condition on record for this time of year due to persistent dry conditions.

In corn, however, there were signs of demand weakness due to high prices since this summer's severe drought slashed yields in the U.S. harvest. U.S. ethanol production, which accounts for nearly 40 percent of domestic corn use, fell 1 percent last week in the third straight week of declines. In the soybean market, however, news that top global buyer China on Wednesday bought 290,000 tonnes of U.S. soybeans, suggested that historically high prices have not dampened demand for the oilseed. The soy market is watching closely the development of the South American crop, which is crucial for reviving low supply. Rains are forecast for Brazil's soybean center-west plains this week. But southern growing regions are set to remain dry, leaving two of the largest producing areas drier than normal in November.

* Prices as of 1155 GMT

Product Last Change Pct Move End 2011 Ytd PctCBOT wheat 876.75 0.75 +0.09 652.75 34.32 CBOT corn 761.75 1.50 +0.20 646.60 17.81 CBOT soy 1455.25 9.00 +0.62 1198.50 21.42 Paris wheat 276.25 0.25 +0.09 195.25 41.49 London wheat 226.45 1.30 +0.58 152.25 48.74 Paris maize 256.25 0.00 +0.00 196.75 30.24 Paris rape 485.00 1.75 +0.36 421.50 15.07 Crude oil 87.51 1.02 +1.18 98.83 -11.45

($1 = 0.7746 euros)

(Editing by Keiron Henderson)