CHICAGO, Jan 26 (Reuters) - U.S. soybean futures hit their highest in seven months on Wednesday on technical buying and as soyoil futures rallied with energy markets and historically high palm oil prices.
Concerns about a reduced South American harvest and exports from top soy supplier Brazil offered further support, with strength spilling over into corn futures.
Wheat futures fell sharply after two days of strong gains that lifted prices to two-month highs.
"Soybeans turned higher early and made another leg up. A lot of that was due to sharply higher bean oil, which is following the palm oil," said Terry Reilly, senior commodities analyst with Futures International.
"Other outside markets are also supporting the bean oil and the soybeans, most notably crude oil," he said.
Crude oil prices reached their highest since 2014 on Wednesday, providing support to corn and soybeans, both key feedstocks for making biofuel.
Chicago Board of Trade March soybeans settled up 32-3/4 cents at $14.40 a bushel, the highest for a most-active contract since June 17. All soybean contracts posted fresh life-of-contract highs.
March corn added 7 cents to $6.27 a bushel, while CBOT March wheat tumbled 23 cents to $7.95 a bushel.
Concerns about tightening global soy supplies limited selling interest in soybeans as traders continue to monitor poor crop weather in parts of South America.
Safras & Mercado slashed its Brazilian soy exports estimate on Wednesday.
Traders have also been circulating Brazilian production estimates from private forecasters, one of which suggested the harvest could be more than 12 million tonnes smaller than the latest U.S. Department of Agriculture estimate.
Meanwhile, private analytics firm IHS Markit Agribusiness reduced its outlook for U.S. soy plantings in 2022.
The market is also watching developments along the Russia-Ukraine border, which could disrupt grain shipments from the major exporting region. (Additional reporting by Naveen Thukral in Singapore, Sybille de La Hamaide in Paris and Pavel Polityuk in Kiev; Editing by Kirsten Donovan, Alexander Smith and Jonathan Oatis)
