U.S. corn futures tumbled to the one-day limit on losses Wednesday and wheat futures fell more than 4% as concerns over low supplies eased.

Both grains have sold off sharply, with corn futures falling to a six-week low after setting all-time highs earlier this month. The pullback in wheat futures was even sharper, touching an 11-month low Wednesday at the Chicago Board of Trade. CBOT December corn dropped 30 cents, or 4.4%, to $6.50 1/4 a bushel. The daily limit expands to 45 cents Thursday.

Funds sold an estimated 30,000 corn contracts, according to floor traders. The big feature in the market was widespread speculation that a large macro fund was liquidating positions in grain futures, said Dan Basse, president of AgResource Co., a Chicago-based agricultural advisory service.

Corn prices also were driven lower by slowing demand and favorable weather for the U.S. crop that is developing. Forecasts for warmer temperatures in the Midwest encouraged projections that output may exceed previous outlooks. Corn futures dropped to their lowest levels since early May, effectively extracting the premium fueled by spring planting problems.

The slide was overdone, as inventories of corn remain tight at a 15-year low, said Jason Britt, president of Central States Commodities, a brokerage in Kansas City, Mo. He said the steep decline "smells of something" and noted talk about fund liquidation.

Wheat slumped on a combination of new supplies from the U.S. harvest that is under way and increased supplies in the export market as output rises in the Black Sea region, analysts said.

European wheat futures sank as well. Prices in Paris were weaker before day trading began in Chicago at 10:30 a.m. EDT and dropped as much as 7%.

"Once Chicago opened, it became a race to the bottom between it and the European markets," said Mike Zuzolo, president of Global Commodity Analytics & Consulting, a brokerage in Indiana.

Commodity funds were unloading positions, including an estimated 8,000 wheat contracts at CBOT. Most-active CBOT September wheat dropped 32 1/4 cents or 4.6% to $6.73 1/4; KCBT September lost 32 3/4 cents or 4% to $7.88 3/4; MGE September dropped 33 3/4 cents or 3.8% to $8.51 1/2.

U.S. soybean futures stumbled, ending at a five-week low on spillover weakness from grain futures. The market was consumed in broad-based selling in grain futures, falling on a domino effect of tumbling wheat and corn futures, said Citi analyst Mario Balletto in Chicago. CBOT November soy ended down 1.3% at $13.32 1/2 a bushel.

Other Markets

CBOT July soymeal dropped 1.3% to $347.10 a short ton and December soyoil fell 0.8% to 57.50 cents a pound.

U.S. rice futures settled lower as selling engulfed the grain markets. Wheat, which exerts the most influence on rice because both grains are global food staples, sank more than 5% to a seven-month low. CBOT September rice lost 22 1/2 cents or 1.5%, to $14.62 1/2 per hundredweight.

Ethanol futures sank as corn prices dropped by their one-day limit. Spillover pressure from corn overshadowed federal data showing ethanol production last week increased 2.3% to 901,000 barrels a day. Ethanol for December delivery lost seven cents, or 2.8%, to $2.389 a gallon. Oat futures fought off heavy selling that hit other grain markets, with the September contract slipping 2 1/2 cents, or 0.7%, to $3.59 a bushel.

-Tom Polansek contributed to this article