* Corn, soybean yields set to be fifth largest on record
* Chicago soybeans fall to three-week low, some traders expected smaller harvest forecast
* Wheat bounces on smaller-than-expected world stocks forecast
NEW YORK, Sept 12 (Reuters) - Chicago soybeans plummeted to a 3-week low and corn sharply dropped on Tuesday after a government report said crops were not hampered as much as some traders had expected by hot and dry summer weather.
The U.S. Department of Agriculture raised its outlook for the corn harvest, as expectations for large acreage harvested outweighed damage done to yield projections that stemmed from prolonged periods of dryness, the monthly World Agricultural Supply and Demand Estimates (WASDE) report said.
While the USDA cut its forecast for the soybean crop, the forecasts still undercut traders' expectations that smaller harvests might support crop prices.
"Clearly, the bulls are going to be disappointed that production didn't come down more for corn and beans," said Craig Turner, a commodities broker at Daniels Trading.
Yields for soy and corn are projected to be the fifth highest on record, nevertheless.
Meanwhile, Chicago wheat futures slumped to a 33-month low ahead of the report, pressured by robust Russian supplies.
The most-active active wheat contract on the Chicago Board of Trade (CBOT) dropped to a new contract low of $5.70 a bushel early in the trading session - the lowest since Dec. 9, 2020. But wheat rebounded on the WASDE report forecasting lower-than-expected world stocks to finish at $5.87-1/2.
Benchmark CBOT December corn futures CZ3 settled down 9-1/4 cents at $4.76-1/2 a bushel. Earlier in the session, the most-actively traded corn contract Cv1 dipped to $4.73-1/2 a bushel, the lowest level since Aug. 16.
CBOT November soybean futures SX3 ended the trading the day down 22-1/2 cents at $13.46-1/2 a bushel. Earlier in the session, the most-active soybean contract Sv1 touched $13.40-3/4 a bushel, the lowest since Aug. 23. (Reporting by Zachary Goelman in New York City; Additional reporting by P.J. Huffstutter and Tom Polansek in Chicago; Editing by Aurora Ellis, Grant McCool and Richard Chang)
