* Soybeans, corn stage tentative recovery amid uncertainty

　　 * Bearish supply fundamentals offset by China demand

　　 * For short-term technical view, click on [TECH/C]

 

　　(Adds details, quotes)

　　 By Bruce Hextall

　　 SYDNEY, May 26 (Reuters) - U.S. soybean and grain futures

　　rose on Wednesday, pulled up by gains in oil prices and a bounce

　　in stocks markets, following sharp falls on Tuesday when worries

　　about Europe's debt problems shook global markets.

　　 A furious late-day rally in U.S. stocks on Tuesday sparked a

　　bounce in Asian shares which edged up from nine-month lows on

　　Wednesday as value investors hunted for bargains, helping boost

　　investor sentiment towards the commodities complex. Oil rose more

　　than 1 percent to hold above $69 per barrel. [MKTS/GLOB][O/R]

　　 "We've seen crude oil higher so it really appears if the

　　grains markets are taking their cue from the energy market at the

　　moment," said Luke Mathews, a commodity strategist at

　　Commonwealth Bank of Australia.

　　 Soybeans and corn prices are sensitive to changes in energy

　　demand as soybeans are used to make biodiesel and corn is used in

　　ethanol production, fuel alternatives to gasoline.

　　 CBOT corn for July delivery advanced 0.75 percent to

　　$3.67 per bushel by 0400 GMT after falling 1.8 percent on

　　Tuesday.

　　 Ideal weather conditions have raised prospects of U.S.

　　farmers growing a record-large corn crop this year, estimated by

　　the U.S. Department of Agriculture (USDA) at 13.4 billion

　　bushels.

　　 The likelihood of a record crop in the United States, the

　　world's largest corn exporter, and a bumper crop being harvested

　　in Argentina, the number two exporter, point to bearish supply

　　fundamentals. But, prices have been supported by Chinese demand.

　　 China bought U.S. corn for the first time in nearly four

　　years last month and to date has bought nearly one million tonnes

　　according to a U.S. Grain Council official, FCStone analyst Doug

　　Jackson said in a market report.

　　 "When Chinese buying occurs it makes the trade sit up and

　　listen," said Mathews.

　　 "We saw that with soybeans last year when the market was

　　faced with growing global supplies and we had China come into the

　　market and buy significant quantities of mainly U.S. supplies

　　that helped support prices and we're seeing a bit of repeat of

　　that this year with corn," he said.

　　 China's demand for soybeans has also supported the oilseed's

　　price this year but prices are now near a two-month low as

　　supplies flow from Brazil, the world's number two soybean

　　exporter after the United States.

　　 Soybeans for July delivery regained 0.54 percent to

　　$9.35-? per bushel by 0400 GMT after shedding 1.1 percent on

　　Tuesday. The contract faces resistance at $9.40 while the

　　November harvest month contract , trading at $9.05, is

　　vulnerable to a slide below $9.00 as bearish supply fundamentals

　　come to the forefront.

　　 July wheat rose 0.43 percent to $4.62-? per bushel

　　after hitting a contract low on Tuesday.

　　 "Across the wheat complex there are some crop production

　　issues in parts of Ukraine and also parts of northern France but

　　I think these concerns are largely outweighed by the fact that

　　we're still looking at abundant global supplies," Mathews said.