U.S. grain and soybean futures fell Wednesday, succumbing to selling driven by traders taking profits on prior gains.

Profit-taking put pressure on prices, as traders worry that historically high values will reduce demand for grain, particularly corn.

U.S. corn futures modestly gave back some of Tuesday's surge that propelled prices to their exchange-imposed daily trading limits. "The market was essentially catching its breath after Tuesday's price spike, with nothing new to attract additional buying in the market," said Shawn McCambridge, senior grains analyst with Jeffries Bache in Chicago.

The market remains in an upward trend, but after pricing in expected yield and production losses Tuesday, traders had little fresh news to support pushing prices farther, McCambridge said.

However, industry observers have gained confidence in lower yield projections, a feature that will continue to limit price setbacks until government forecasters release crop projections next week.

Grain users remain nervous about the potential for a smaller-than-expected harvest due to damage from intense heat last month. The size of this autumn's harvest is important because farmers need to grow a large crop to replenish low inventories. Supplies of corn are expected to reach a 15-year low this year and tighten further in the coming year.

Without a change to wetter, cooler weather profiles, corn and soybean markets will continue to find solid underlying price support.

Meanwhile, spillover weakness from external financial markets, with sharply lower crude oil futures and overall economic unrest, limited investor interest. Fears of a stagnant economy slowing overall demand, helped fuel selling as traders reduced risk exposure.

Further price pressure was generated from a weaker cash basis, with movement of cash supplies picking up following Tuesday's limit-up move in corn futures, said Terry Reilly, analyst with Citi in Chicago.

Without the support of higher corn prices coupled with external market pressure, wheat and soybean futures succumbed to profit-taking pressure.

CBOT December corn end down 0.4% at $7.13 a bushel. CBOT Sept wheat ended down 1% at $7.10 1/2, KCBT September wheat dropped 1.2% to $7.98 and MGEX September wheat end down 0.6% at $8.44 3/4. CBOT November soybeans ended down 0.5% at $13.73.

Other Markets

CBOT December soyoil ended down 1.4% at 57.06 cents a pound, and December soymeal finished down 1% at $361.60 a short ton.

U.S. rice futures closed lower with other grains on profit-taking. CBOT September rice slid 2 1/2 cents to $16.34 1/2 per hundredweight.

Ethanol futures weakened with corn and crude-oil prices. Ethanol for December delivery dropped 0.4% to $2.575 per gallon. Oat futures pulled back as traders took profits after a rally Tuesday. Oats for September delivery finish down 2.4% at $3.45 1/2 a bushel.

--Tom Polansek contributed to this article.