* Wheat edges up to trade close to Tuesday's high
* Risk of cold damage to U.S. wheat encourages short-covering
* Soybeans firm as dry weather persists across Argentina
* Corn tracks wheat and soy higher
(Updates with European trading, changes byline/dateline) PARIS/SYDNEY, Jan 3 (Reuters) - Chicago wheat futures rose for a second day on Wednesday, holding near a four-week high touched in the previous session, as the market assessed the risk of crop damage from severe cold in U.S. growing regions this week. Soybeans edged higher for a third straight session as concerns about production in Argentina lent support, while corn also rose marginally. The most active wheat futures on the Chicago Board Of Trade were up 0.5 percent at $4.35-1/2 a bushel by 1303 GMT, close to Tuesday's high of $4.36-1/4 a bushel - a level not seen since Dec. 5. Extreme cold in parts of the U.S. Plains and Midwest at the start of the week led some crop watchers to point to potential losses, including in the top wheat growing state of Kansas. However, some analysts and traders said it was too early to predict the extent of weather damage. "Thanks to some short-covering from financial funds in Chicago caused by risks of winter kill on U.S. winter wheat, wheat prices are resisting," consultancy Agritel said in a note. "The return to higher temperatures in coming days should temper the rising potential of the market." Investments funds were net buyers of CBOT wheat, corn and soybean futures contracts on Tuesday, according to trade sources. Weather risks, which also include persisting dryness in the U.S. Plains, have taken attention away from a backdrop of high world supply of wheat and stiff export competition. Export inspections of wheat during Dec. 21-28 totalled 274,506 tonnes, the U.S. Department of Agriculture (USDA) said on Tuesday, below trade estimates of 300,000 to 600,000 tonnes. Corn and soybean export volumes were in line with market expectations.
Analysts said soybeans continue to draw support amid concerns about dry weather in Argentina, the world's third-largest exporter of the oilseed. Argentina's bread-basket province of Buenos Aires will remain mostly dry in the days ahead, meteorologists said on Tuesday, after reporting scant rains over the weekend. The most active CBOT soybean futures were up 0.5 percent at $9.69-1/4 a bushel. Corn added 0.3 percent to $3.54-1/4 a bushel, as it continued to track gains in soybeans and wheat. Firm crude oil prices also lent support to the crops, which are used in making biofuels, although a bounce in the dollar curbed recent impetus from a weaker U.S. currency.
Prices at 1303 GMT
Last Change Pct End Ytd Pct Move 2017 Move CBOT wheat 435.50 2.00 0.46 427.00 1.99 CBOT corn 354.25 1.00 0.28 350.75 1.00 CBOT soy 969.25 4.50 0.47 961.75 0.78 Paris wheat Mar 159.75 1.25 0.79 159.00 0.47 Paris maize Mar 157.50 5.50 3.62 157.75 -0.16 Paris rape Feb 353.00 2.75 0.79 347.75 1.51 WTI crude oil 60.84 0.47 0.78 60.42 0.70 Euro/dlr 1.20 0.00 -0.29
Most active contracts - Wheat, corn and soy US cents/bushel, Paris futures in euros per tonne
(Reporting by Colin Packham and Gus Trompiz; Editing by Christian Schmollinger and David Evans)