GRAINS-CBOT corn rises 1.4%, hits 7-1/2-year high; wheat, soybeans fall

(Updates with closing prices)

By Mark Weinraub

CHICAGO, Jan 13 (Reuters) - U.S. corn futures rose 1.4% on Wednesday, hitting a 7-1/2-year high with the market focused on prospects for tight global supplies after the U.S. Department of Agriculture cut production estimates for the United States, Brazil and Argentina.

"The number on corn was a game changer yesterday," said Dan Smith, senior risk manager at Top Third Ag Marketing.

Chicago Board of Trade soybean and soft red winter wheat futures weakened on profit-taking after hitting their highest in 6-1/2 years.

CBOT March corn futures settled up 7-1/4 cents at $5.24-1/2 a bushel. The most-active contract peaked at $5.41-1/2 a bushel, its highest since June 28, 2013, during overnight trading.

"The USDA's seemingly unending cuts to U.S. G&O (grain and oilseed) supplies continued this month, and with soybean and corn stores particularly bare, it seems only a matter of time before cuts shift to demand," Rabobank said in a note.

The USDA revised downwards its estimate of 2020/21 U.S. corn production to below trade expectations and lowered its outlook for ending stocks.

CBOT March soybeans dropped 12 cents to $14.06-1/4 a bushel, its biggest daily setback since Dec. 8.

"We are ... off the highs but people have to realize that we are $5.50 off the bottom," Top Third's Smith said. "We are going to see some corrective action in here."

Investors shrugged off a USDA announcement on Wednesday morning that private exporters reported the sale of 464,300 tonnes of soybeans to unknown destinations, the biggest daily soybean sale since June.

CBOT March soft red winter wheat dropped 4-1/2 cents to $6.60-1/2 a bushel.

K.C. hard red winter wheat and MGEX spring wheat closed firm on hopes that U.S. supplies would gain traction on the export market after Russia's agriculture ministry said it may impose a higher export tax on wheat.

(Additional reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore. Editing by Pravin Char, Mark Potter and Paul Simao)

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