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GRAINS-Corn, soy slip as U.S. crop weather looks less threatening

* Concerns ease over hot, dry forecasts

* U.S. soy crop rated better than expected

* Corn condition rating misses estimates (New throughout, updates prices, market activity and comments to the start of U.S. trading; new byline, changes dateline, previous HAMBURG)

By Tom Polansek

CHICAGO, July 7 (Reuters) - U.S. corn and soybean futures eased on Tuesday as weather forecasts looked less threatening to America's crops than they had a day earlier, analysts said.

Traders took profits a day after soybean futures reached a four-month high on concerns that hot, dry conditions in the U.S. Midwest could threaten crop yields. There now appears to be a better chance for rain later this week and next week, according to Commodity Weather Group.

The markets are paying close attention to weather forecasts because corn is entering a critical stage for crop development. Yields are important because the U.S. Department of Agriculture last week estimated that farmers planted fewer acres than analysts expected.

"The weather forecast is not quite as dire as some had thought yesterday," said Tomm Pfitzenmaier, analyst for Summit Commodity Brokerage in Iowa.

Chicago Board of Trade most-active December corn fell 3-3/4 cents to $3.52-1/2 a bushel by 10:30 a.m. CDT (1530 GMT). Most-active November soybeans dropped 1-1/4 cent to $9.05 a bushel.

The CBOT wheat market bucked the lower trend, with the most-active September contract trading up 4-1/4 cents at $4.97-1/2.

After Monday's market close, the USDA's weekly U.S. crop-progress report said 71% of the U.S. soybean crop was in good-to-excellent condition, unchanged from the previous week and above analysts' expectations of 70%.

The USDA said 71% of U.S. corn was in good-to-excellent condition, down from 73% last week and 72% expected by analysts.

"The USDA's crop conditions report said U.S. corn and soybeans are looking reasonable with no reason today for extra concern about crops," said Matt Ammermann, StoneX commodity risk manager.

"But the concern about the U.S. weather remains in the market and the mood could change quickly if there are new forecasts for hot, dry weather in U.S. corn regions in the coming days." (Reporting by Tom Polansek in Chicago. Additional reporting by Michael Hogan in Hamburg and Colin Packham in Sydney, editing by David Evans and David Gregorio)

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