World champion Loeb, the runaway leader of this year's championship with a 35-point lead over the Finn, is sitting out this race after breaking his arm in a mountain biking accident.
Gronholm made the most of his opportunity on Friday opening up a 26sec lead over Norway's Petter Solberg in a Subaru Impreza. Three stages of the rally were cancelled on Friday because of heavy rain.
Loeb's replacement in the race, former world champion Colin McRae, was seventh in his Citroen.
"They weren't great conditions to drive in," said Gronholm. "They were terrible, you can't imagine what it was like. There were places where you could go well and others which were full of surprises. It's difficult but it's the same for everyone."
There had been constant rain for two days in the mountains here and the persistent fog had prevented the medical helicopter from taking off for the first two stages causing them to be cancelled.
For McRae, it was a testing return to the championship. "It was not easy. The conditions are terrible, really bad, the worst I've ever seen," said the Scotman who finished the day 1min 25sec behind Gronholm.
"So all we can do is survive, and not make any mistakes. It's a lottery if you push too hard because you run a very high risk of getting off the road. So you need to be really careful."
