Wires

GRAINS-Soybeans bounce on China trade hopes, but Mideast tensions fuel unease

Karl Plume

* Soybeans recover after Friday drop, eye on China deal signing

* U.S.-Iran tensions fuel investor nervousness

* Corn eases, wheat extends pullback from 16-month top

* Market awaits USDA supply/demand report due Friday (Rewrites throughout with U.S. market open, adds quote, updates prices, changes byline, changes dateline from PARIS/SINGAPORE)

CHICAGO, Jan 6 (Reuters) - U.S. soybean futures rebounded on Monday from steep declines in the previous session as hopes for improved exports to China outweighed worries about rising tensions in the Middle East.

Corn and wheat futures declined in a technical-selling and profit-taking retreat from multi-month highs posted last week and as investors look ahead to key U.S. Department of Agriculture (USDA) supply and demand data due later this week.

Geopolitical tensions after the United States killed an Iranian general erased new year gains for world stocks while safe-haven gold climbed to a seven-year high and oil jumped to its highest since September.

Developments in the Middle East overshadowed an initial trade accord between Washington and Beijing that had buoyed crop markets last month.

"Soybeans overdid it to the downside. We came unravelled (on Friday) with the whole Middle East situation and soybeans took the brunt of it... Now we're getting a retracement of some of the big down move," said Don Roose, president of U.S. Commodities.

Optimism that China would accelerate purchases of U.S. farm goods remained supportive for crop markets, particularly soybeans, as officials from Beijing are expected to travel to the United States next week to sign a Phase 1 trade deal.

Chicago Board of Trade March soybeans rose 4-1/2 cents to $9.35 a bushel by 11:30 a.m. CST (1730 GMT) following a 1.5% drop on Friday.

CBOT March corn declined 1-1/2 cents to $3.85 a bushel after failing to hold technical chart support at its 50- and 100-day moving averages.

CBOT March wheat shed 3-3/4 cents to $5.50-3/4 a bushel after rising last week to the highest point for a most-active contract in more than 16 months.

Grain markets are awaiting further fundamental direction from USDA crop estimates this Friday.

The Jan. 10 data will give further indications about the size of last year's corn harvest, delayed by cold, wet weather, as well as projections of world grain supply and demand.

Rainfall alleviated dry conditions in Brazil, the world's biggest soybean exporter, which also curbed Chicago grain prices.

"Most Brazil first-crop corn and soybean areas saw beneficial rainfall over the past week," Refinitiv Agriculture Research analysts said in a note, adding that widespread rainfall was expected over the next week.

(Additional reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore, Editing by David Evans and Chris Reese)