The 2014 U.S. corn crop, while still a record, will be slightly below recent market expectations according to government data released on Monday, giving a boost to beaten-down corn prices, while soybean production continues to rise.

CBOT corn futures closed up 0.5 percent on the bullishly construed data, with wheat futures also up 0.5 percent. Soybean futures dropped 1.2 percent on the projected larger crop.

The U.S. Department of Agriculture trimmed its corn crop estimate to 14.407 billion bushels from 14.475 billion in October, and lowered ending stocks to 2.008 billion bushels from 2.081 billion. Traders had leaned toward higher estimates.

"It was surprising to see the revision lower in corn production. The trade solidly felt an increase was due," said Rich Nelson, chief strategist at Allendale Inc.

USDA's fourth round of 2014 crop estimates mostly reflected fine tuning, though, with a hearty dose of harvested data to inform the agency's estimates.

USDA estimated the U.S. soybean crop at a record 3.958 billion bushels, up less than 1 percent from October and a hair below trade forecasts averaging 3.967 billion. The crop is inching closer to the once unthought-of 4 billion-bushel mark.

Projected 2014/15 U.S. soybean ending stocks were steady on the month at 450 million bushels.

USDA raised its export and crush forecasts by a combined 30 million bushels to absorb the larger crop, a potential boon to major grain processors and exporters.

Darrel Good, agricultural market economist at the University of Illinois, said higher demand shown in the report should be constructive to prices over the long term.

"The big story this year will be that extremely large corn and soybean crops resulted in less than burdensome year ending stocks. The modest level of stocks relative to the consumption base opens the door for a tighter supply and consumption balance for the 2015/16 marketing year," Good said in a blog post.

U.S. corn yields will be a record 173.4 bushels per acre, with 22 states expected to post new yield marks. Nov. 1 yield data shows the highest number of ears on record for the 10 primary growing states, USDA said.

Soybeans were also in great shape. Compared with final results for 2013, pod counts are up in eight of the 11 published states, USDA said. Fifteen states are heading toward record high soybean yields, including No. 1 producer Illinois.

Forecast U.S. wheat carryout was lowered by 10 million bushels, to 644 million, as a 30-million-bushel cut in stocks of hard red spring wheat more than offset an increase of 20 million bushels in hard red winter wheat stocks. USDA resurveyed some states' wheat crops and lowered the 2014/15 U.S. wheat crop by 9 million bushels, to 2.026 billion. (Editing byAndrea RicciMatthew Lewis and Andrew Hay)