* A strong dollar and hefty Black Sea grain supplies weighed on corn and wheat futures

* Soybeans bounced on short-covering and news of export sales

CHICAGO, March 20 (Reuters) -

Chicago Board of Trade (CBOT) wheat and corn futures tumbled on Wednesday, dragged by plentiful supplies of cheap Black Sea and South American grains and a strong dollar, which tends to make U.S. grain exports less competitive.

Soybean futures rose, supported by traders unwinding short positions and news of fresh U.S. export sales, analysts said. The U.S. Department of Agriculture (USDA) confirmed private sales of 120,000 metric tons of U.S. soybeans to undisclosed destinations, the first such sales announcement since Feb. 27..

Commodity funds hold sizable

net short positions

in soybean, corn and wheat futures, priming markets for bouts of short-covering.

Wheat fell for the first time in three sessions while corn lost ground after rising on the previous session.

"We're trading back and forth and not doing a lot to build momentum," Lane Akre, commodities analyst at ProFarmer, said.

As of 11:44 a.m. CDT (1644 GMT), CBOT wheat fell 9-3/4 cents to $5.42-3/4 a bushel and corn slid 1-1/2 cents to $4.38 a bushel.

Benchmark soybean futures added 13-1/2 cents, rising to $11.99 per bushel.

Soybeans were firming ahead of the USDA's March 28 Prospective Plantings and quarterly stocks reports, which have a history of jolting markets.

However, strong crop prospects in South America limited rallies.

"The U.S. isn’t competitive at all on beans and wheat in terms of exports, and that’s a wet blanket on the market," Austin Schroeder, commodities analyst at Brugler Marketing & Management, said.

A newly released Chinese customs report showing China slashing its imports of

U.S. corn and soybeans in favor of Brazilian crops

is also likely weighing on U.S. futures prices, Akre said.

For wheat, traders await the results of an international

purchase tender

set by Egypt's main state wheat buyer. Russian wheat was offered many times at the same price, though the lowest free-on-board offer was for Romanian wheat, traders said. (Reporting by Heather Schlitz in Chicago. Additional reporting by Naveen Thukral; Editing by Subhranshu Sahu, Savio D'Souza and David Gregorio)