Corn futures in Chicago plunged to the lowest levels in more than two weeks today after the government reported unexpectedly large stockpiles, providing pork and beef producers with at least a temporary respite from a summer feed price run-up.

The nation’s corn supplies as of Sept. 1 totaled 1.708 billion bushels, up 2.1 percent from a year earlier, the USDA said in its quarterly Grain Stocks report earlier today.

Stocks were about 300 million bushels, or 21 percent above the average analyst projection, sending December corn futures at the Chicago Board of Trade down as much as 26 ¾ cents earlier today. Earlier this week, corn futures reached $5.28 ¾ a bushel, a two-year high.

The report may keep a lid on corn prices for a few weeks, though the market retains a bullish bias amid expectations for a smaller U.S. harvest, analysts said.

Paul Nelson, an analyst with EHedger, LLC, in Chicago, expects corn futures to trade between $4.60 and $5.10 a bushel until the USDA releases updates to its crop production and supply and demand estimates Oct. 8.

If the USDA’s corn yield estimate is “substantially” lower, today’s unexpectedly high stocks figure “won’t really matter,” Nelson said.

Livestock producers “are still going to need to maintain a very close eye on the cost of feed,” Nelson said. “There will be plenty” of feed, he added, “it’s just a question of, at what price.”

In late trading today, December corn fell 13 cents to $4.92 a bushel, after earlier dropping to $4.78 ½, the lowest price since $4.76 ½ on Sept. 13. December futures are still up 32 percent since the end of June.

Heavy August rains led to crop deterioration in parts of the Midwest, prompting the USDA to scale back its forecast for this year’s corn harvest.

In a Sept. 10 report, the USDA trimmed expected 2010 corn production to 13.16 billion bushels, down 1.6 percent from a previous estimate, though still a record crop. The USDA also cut the average estimated U.S. corn yield to 162.5 bushels an acre from 165 bushels.

Early harvest results were disappointing, and futures prices this month indicated traders expected an average yield closer to 155 bushels an acre, Nelson said. But more-recent reports of strong crops in northern Illinois, Iowa and Nebraska suggest the average yield won’t drop that much, he said.

Feed costs are expected to remain elevated, but smaller animal inventories and high cattle and hog prices should allow livestock producers to sustain profit, Nelson said.

“If corn prices march substantially higher, the market will continue to reward the producer,” Nelson said. “It will keep their feeding margins in line” with higher feed costs.

At today’s close, December lean hog futures traded at CME Group rose 0.875 cent to 74.725 cents a pound. The CME contract is based on carcass values.