* Steady dollar supports in subdued trade
* Grains stay forex-sensitive, bearish fundamentals cap
* Corn may find support in planting hitches, ethanol demand
* Coming up: U.S. February non-farm payrolls at 1330 GMT
(Updates with quotes, European trading, previous SYDNEY)
By Bruce Hextall and Gus Trompiz
PARIS/SYDNEY, March 5 (Reuters) - Chicago soybean and grain futures clawed back ground on Friday as a steady dollar supported soft commodities after a day of heavy losses.
Gains were modest as the market awaited the release later on Friday of the U.S. employment report for February, seen as a key indicator of the pace of economic recovery.
Grain markets were also waiting for direction from next Wednesday's closely watched World Agricultural Supply and Demand Estimates report from the U.S. Department of Agriculture.
"Currrency and grains markets will be choppy in front of those U.S. employment numbers tonight and if the numbers point to an improving U.S. economy you will see a rally in global equities markets and the dollar but grains could fall," said Garry Booth, an adviser at MF Global Australia.
A rising dollar makes U.S. priced commodities more expensive for buyers holding other currencies and tends to push prices of those commodities lower, as happened in Chicago on Wednesday.
Bearish fundamentals continued to cap gains, including upgrades to projected Argentine soybean and corn crops by Informa Economics on Thursday.
The respected analytical firm raised its estimate of Argentina's 2009/10 soybean production to 55.0 million tonnes and its corn production to 21.0 million tonnes, trade sources said..
In Brazil, meanwhile, the soybean harvest is gathering pace, encouraging China, the world's largest soy importer, to switch to buying supplies from the South American nation, the No. 2 soybean exporter, rather than from the United States.
China made no purchases of U.S. soybeans in the latest week......More detail
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