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Brazil soybean harvest estimate boosted to 155 mln tonnes

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Markets awaiting rate hike decision by Federal Reserve

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Wheat, corn still capped by Black Sea grain deal extension

March 21 (Reuters) - Chicago soy futures reversed gains to close lower on Tuesday, pushed down by rising estimates of Brazilian production, while corn and wheat dipped as markets kept a cautious eye on an expected Federal Reserve rate hike.

Wheat and corn continue to be capped by the extension of a Black Sea export corridor from Ukraine, while an improvement in wheat conditions in some U.S. states and rain expected in Brazil and drought-hit Argentina also curbed grain prices.

Soybeans were pushed down after Brazilian agribusiness consultancy Agroconsult raised its estimate of the country's soybean harvest to a record 155 million tonnes, from 153 million tonnes previously, following a survey of soybean areas nationwide.

The most active soybean contract on the Chicago Board of Trade (CBOT) settled down 19 cents at $14.67 per bushel, retreating after rising to $14.97 earlier in the session.

CBOT wheat settled down 17-1/2 cents at $6.83-1/4 per bushel, while corn closed down 3 cents at $6.30 per bushel.

Investors were watching for the U.S. Federal Reserve to take a less aggressive line in an interest rate announcement on Wednesday.

"I think everybody's just taking a low profile until they get some kind of an indication of what the Fed is going to do with their policy," said Dale Durchholz, commodity analyst at Grain Cycles.

The renewal of the Black Sea grains deal continued to weigh on prices, though the United States pushed back on Russian demands that Western sanctions be eased before it allows Ukrainian Black Sea grain exports beyond mid-May, saying there were no restrictions on Russian agricultural products or fertilizer.

Grain markets were also monitoring harvest prospects. Ukraine's 2023 grain harvest is likely to fall to 44.3 million tonnes from 53.1 million in 2022 as less acreage is sown due to Russia's invasion, a forecast by the Ukrainian agriculture ministry showed on Monday. (Reporting by Cassandra Garrison in Mexico City, Gus Trompiz in Paris and Naveen Thukral in Singapore; Editing by Subhranshu Sahu, Susan Fenton, Jonathan Oatis and Alison Williams)