Corn drops after forecast for lower production

CHICAGO, Oct 15 (Reuters): Chicago corn futures lost ground on Monday as the market took a breather following two sessions of strong gains triggered by a forecast for lower US production.
Wheat eased slightly after climbing 1.8 per cent on Friday, with prices supported by weaker production in Russia and Australia.
The Chicago Board of Trade most-active corn contract had dropped 0.5 per cent to $3.71-3/4 a bushel by 1056 GMT, while soybeans gave up 0.35 per cent to $8.64-1/2 a bushel.
The corn market climbed to its highest since Aug. 21 on Friday at $3.74 a bushel.
On Monday wheat dipped 0.1 per cent to $5.16-1/2 a bushel.
"Soybeans and corn are easing after strong gains that we saw at the end of last week," said Phin Ziebell, agribusiness economist at National Australia Bank.
"The USDA has cut its estimates for corn and soybean crops, but both crops are expected to still be pretty large which will keep a lid on prices."
The US Department of Agriculture unexpectedly trimmed its forecasts for domestic corn and soybean output on Thursday. The soy cut stemmed from a reduction in acres while the corn harvest will be lower due to smaller-than-expected yields.
The corn crop was seen at 14.778 billion bushels, based on an average record yield of 180.7 bushels per acre, the government said in its monthly supply and demand report.
Soybean production was pegged at 4.690 billion bushels, with yields averaging a record 53.1 bushels per acre. There was additional support for corn and soybeans stemming from delays in the harvest in the United States.
Drier Midwest weather is expected in the second half of October, but heavy rains last week may have damaged some crops.
Strategie Grains analysts sharply increased their estimate of this year's maize harvest in the European Union on Friday as bumper yields in southeast Europe were seen offsetting a drought-hit crop further west.