Soybean, corn slides on profit-taking amid South American weather woes

* Dry weather in South America raises soybean supply worries

* Low-end export inspections pressure wheat

* Funds increase long positions in corn

CHICAGO, Dec 28 (Reuters) - Chicago soybean futures fell on profit-taking on Tuesday, as uncertainty over weather forecasts in South America continued to spark questions over global supplies, traders said.

Wheat prices fell sharply, extending losses from the previous session, as investors began to jockey their positions ahead of the year-end. And corn futures slipped, as some market players saw prices overextended to the upside from Monday's rally.

The Chicago Board of Trade's most-active soybean contract settled down 3-1/2 cents to $13.68 a bushel. Corn settled down 10 cents at $6.04-3/4 a bushel.

Soybean and corn crop harvests are expected to be smaller in southern Brazil this season as fields are suffering from dryness, weather forecasters and consultancies said.

But parts of central and southeastern Brazil may see some "limited relief" from rain later this week, Commodity Weather Group said on Tuesday. An "active rain pattern" in northern Brazil could help crop growth, but signs of "excess rain" and flooding concerns are emerging in northeastern areas, the company said.

"It's still early in the growing season, and the crops can recover, which is why the grain markets are back-pedaling a bit," said Karl Setzer, commodity risk analyst at Agrivisor.

Wheat settled down 20-1/2 cents at $7.83-1/2 a bushel as traders pointed to last week's disappointing U.S. export inspections and a lack of competitiveness, particularly with Russia, despite export taxes.

The U.S. Department of Agriculture on Monday said 271,349 tonnes of U.S. wheat was inspected for export last week, which was on the low end of a range of trade estimates.

Funds are turning their attention back to the corn market, say traders, as their long positions in corn are nearly back to where they were in late November.

Large speculators raised their net long position in CBOT corn futures in the week to Dec. 21, regulatory data released on Monday showed. (Reporting by PJ Huffstutter in Chicago, Sybille de La Hamaide in Paris and Naveen Thukral in Singapore; editing by Uttaresh.V, Dan Grebler and Mark Porter)