GRAINS-Corn drops for 10th day, wheat, soy fall too

* Corn drops well into technically oversold territory

* Rising open interest in corn signals new short positions

* Wheat slides on improving U.S. Plains weather

* Soybeans fall as export sales disappoint

(Recasts with U.S. trading; changes dateline from previous PARIS/NEW DELHI, changes byline) CHICAGO, Feb 14 (Reuters) - U.S. corn futures slipped for a 10th straight session on Thursday, their longest string of declines since 2007, as crop-friendly weather in South America and expectations of higher global supplies dragged down prices. Wheat futures fell as improving U.S. weather conditions and fund selling overshadowed strong weekly U.S. export sales data, and soybeans fell after weekly export sales fell short of trade expectations. At the Chicago Board of Trade as of 11 a.m. CST (1700 GMT) , March corn was down 3-1/2 cents, 0.5 percent, at $6.92 per bushel. March wheat was down 9 cents, 1.2 percent, at $7.26-1/2 a bushel. March soybeans were down 7 cents, 0.5 percent, at $14.16 a bushel. Corn's slide, matching a 10-day skid in June 2007, has pushed the market well into technically oversold territory. The nine-day relative strength index for the March contract stood at 25 ahead of Thursday's trade. An RSI of zero to 30 is one sign of an oversold market, while a reading of 70 to 100 indicates an overbought market. But open interest in CBOT corn futures has risen over the course of the February sell-off, indicating that traders are adding new short positions. Open interest in CBOT wheat has also increased this month while prices have fallen. "It continues to be a sentiment trade rather than a supply/demand trade," said Mike Zuzolo, president of Global Commodity Analytics in Lafayette, Indiana. CBOT wheat posted the biggest percentage declines, pressured much-needed moisture in the dry U.S. Plains winter wheat belt. The weekly U.S. Drought Monitor report issued by a consortium of state and federal climatologists still showed severe drought across 82.51 percent of the High Plains region, but the figure was down from 87.25 percent a week earlier.

"We've had some moisture out west which has eased some of the production concerns. And (crop) conditions overseas are generally favorable," said Shawn McCambridge, an analyst with Jefferies Bache in Chicago. The U.S. Department of Agriculture reported weekly export sales of U.S. wheat for the current and new marketing year at 706,300 tonnes, a seven-week high that topped trade expectations for 275,000 to 400,000 tonnes. But the data failed to confirm sales of U.S. wheat to Brazil, Britain or Russia that had been rumored last week. "The attitude is that maybe it was just talk," McCambridge said. "Even though prices are oversold and we had decent export sales, we need to continue to see a decent pace of sales to keep USDA's forecast within reach."

SOYBEAN EXPORT SALES SLOW Weekly export sales of soybeans fell short of expectations. The government pegged sales at 235,900 tonnes, including net cancellations of 109,100 tonnes for 2012/13 and net sales of 345,000 tonnes for 2013/14. Trade estimates were for 700,000 to 1.1 million tonnes. Improving crop weather in South America continues to pressure soybeans as well, with Brazil poised to surpass the United States as the world's biggest soybean producer. Brazil's soybean harvest is 12 percent complete, above the five-year average of 7 percent, analyst Celeres said Wednesday.

In Argentina, rains expected this weekend should bring relief to corn and soy crops stressed by recent dryness. "The prediction of rainfall in the drought-plagued growing areas in the U.S. and in Argentina is continuing to exert pressure on the prices of grains and soybeans," Commerzbank analysts said.

Prices at 11:03 a.m. CST (1703 GMT)

LAST NET PCT YTD CHG CHG CHG CBOT corn 691.75 -3.75 -0.5% -0.9% CBOT soy 1415.50 -7.50 -0.5% -0.2% CBOT meal 405.40 -2.70 -0.7% -3.6% CBOT soyoil 51.64 -0.02 0.0% 5.0% CBOT wheat 726.25 -9.25 -1.3% -6.7% CBOT rice 1579.50 -6.00 -0.4% 6.3% EU wheat 241.25 -1.00 -0.4% -3.6%US crude 97.56 0.55 0.6% 6.3% Dow Jones 13,966 -17 -0.1% 6.6% Gold 1641.19 -1.17 -0.1% -2.0% Euro/dollar 1.3335 -0.0118 -0.9% 1.1% Dollar Index 80.4910 0.4000 0.5% 0.9% Baltic Freight 748 -3 -0.4% 7.0%

(Additional reporting by Gus Trompiz in Paris and Mayank Bhardwaj in New Delhi; editing by William Hardy and David Gregorio)