* CBOT soy drops about 3% so far this week

* Corn, wheat also head for weekly losses

* USDA crop data due out next week

CHICAGO, Jan 5 (Reuters) - Chicago Board of Trade soybean futures crumbled on Friday, on track for a third weekly decline after much-needed rains hit dry growing areas in Brazil.

Corn futures also weakened. Wheat prices advanced but were poised to end the first week of 2024 in negative territory.

The setback in soybean futures came as rains have reduced concerns about crop losses in the world's biggest exporter of the oilseed. Stabilizing yields could prevent soy buyers from shifting export business to the U.S. from Brazil, as the nations compete for sales on the world market.

For the week so far, soybean futures were down about 2.9%, while corn slipped about 1.9% and wheat lost 1.8% at the CBOT.

"It's been lower this week as we came back from the holiday," said Sherman Newlin, an Illinois farmer and analyst with Risk Management Commodities. "It's been based off of all the rain that's been going on in South America."

Most-active CBOT March soybean futures were down 7 cents at $12.60-1/2 a bushel by 10:50 a.m. CST (1650 GMT) after reaching the lowest price since June 15.

March corn futures were down 4 cents at $4.62-1/2 a bushel and trading near a contract low of $4.61-3/4 that was reached on Wednesday. March wheat rose 2-1/2 cents to $6.16 a bushel after sliding on Thursday to its lowest price since Dec. 1.

Grain traders are waiting for the U.S. Department of Agriculture to issue quarterly U.S. grain stocks and monthly supply/demand reports on Jan. 12. Many expect the USDA to trim its estimate for Brazil's soy harvest.

Agribusiness consultancy Safras & Mercado lowered its forecast for Brazil's crop to 151.36 million metric tons from 158.23 million.

The USDA on Friday reported export sales of U.S. 2023/24 soybeans in the week ended Dec. 28 were 201,600 metric tons, below analysts' expectations for 500,000 to 1,300,000 tons. Weekly U.S. corn and wheat sales also missed expectations. (Reporting by Tom Polansek in Chicago. Additional reporting by Naveen Thukral in Singapore and Sybille de La Hamaide in Paris; Editing by Sonia Cheema, Mark Potter and David Gregorio)