CANBERRA, July 3 (Reuters) - Chicago corn and soybean futures edged lower on Wednesday and were hovering above multi-year lows as concerns over the condition of U.S. crops were offset by ample supply.

Wheat futures rose but were under pressure from a rapidly advancing U.S. harvest and near two-month lows.

The most-active corn contract on the Chicago Board of Trade (CBOT) was down 0.2% at $4.20-1/4 a bushel by 0432 GMT after falling to $3.99-1/2 on Friday, its lowest since 2020.

CBOT soybeans meanwhile dipped 0.1% to $11.12-1/4 a bushel after having slumped to $10.97, also its lowest since 2020, on Monday.

U.S. government data in recent days showed a deterioration of the condition of the U.S. corn crop and some forecasters predict dry and hot weather in late July or early August in the western Corn Belt that could impact soybean pod setting.

But the U.S. Department of Agriculture (USDA) also reported a larger corn planted area than it previously forecast and said U.S. farmers were holding on to corn and soybeans in the hope of better prices, which could hamper any rally.

"Last week's U.S. stocks and acreage report showed that there's a lot of corn around," said Commonwealth Bank analyst Dennis Voznesenski.

"Production prospects also look good for soybeans in the U.S. and there are challenges on biofuel demand in the U.S. as well," he said.

In Brazil, second-corn farmers are expected to reap 100.5 million metric tons in the 2023/24 cycle, 10% less than last season but more than initially thought, consultants Agroconsult said.

China's COFCO International said it projects a potential increase of Brazilian soybean and corn harvests in the 2024/25 cycle.

CBOT wheat was up 0.5% at $5.83-3/4 a bushel after falling to a two-month low of $5.57 in June.

Harvesting of U.S. winter wheat continued to progress ahead of the average pace and condition ratings improved for spring wheat in the northern Plains, the USDA said.

Russian wheat export prices declined for a fourth week in a row last week but uncertainty remains about the final size of the harvest in the world's largest wheat exporter.

(Reporting by Peter Hobson; Editing by Rashmi Aich and Mrigank Dhaniwala)