WASHINGTON (AP) The Agriculture Department on Monday lowered its forecasts for this year's U.S. corn and soybean harvests, pushing up the prices of both commodities.

The USDA said corn production is expected to be 12.02 billion bushels, down from last month's revised estimate of 12.03 billion and below analysts' estimates of 12.08 billion. Corn yield per acre is expected to come in at 153.8 bushels, down from last month's estimate of 153.9. Analysts expected the yield to be 154.4.

The lower yield and production ``caught the market off-guard,'' said Joe Victor, vice president for marketing at Allendale Inc., a commodities broker based in McHenry, Ill.

In North Dakota, the latest forecast projects the state's corn production at 285 million bushels, down 2 percent from October's projection but still a record and 5 percent more than last year. The state's soybean forecast is down 6 percent from October, to 108 million bushels.

The USDA estimated North Dakota's dry edible pea production at 7.9 million hundredweight, down 24 percent from last year. The report said the average yield is estimated at 1,580 pounds per harvested acre compared with 2,080 pounds last year.

The state's lentil production is estimated at 828,000 hundredweight, down from 1.34 million hundredweight last year, due to a drop in harvested acres. Fall potato production also is down _ estimated at 22.7 million hundredweight compared with 23.7 million hundredweight last year. The USDA said the harvested fall potato acres are down 10,000 from last year, to an estimated 81,000 acres.

Corn and soybean futures prices initially rose in response to the report. Corn for December delivery traded at $3.77 a bushel by late morning, up 1.5 cents, after reaching $3.85 immediately after the report, according to the Chicago Board of Trade.

Soybeans for January jumped 19 cents in early trading to $9.40 per bushel.

Analysts also said China's announcement of a $586 billion stimulus package should boost demand for commodities by maintaining that country's economic growth.

China also is building reserves of soybeans for its livestock producers, said Lynn Smith, a futures broker at the Zaner Group in Chicago. ``Demand (for soybeans) is expected to continue to be strong,'' he said.

The soybean harvest is forecast to be 2.92 billion bushels, down from 2.94 billion, according to the USDA's November report. The new projection matched analysts' estimates.

Soybean yield per acre is forecast to be 39.3 bushels, down from 39.5 last month.

The USDA lowered its estimate of the average price of corn for the year to a range of $4 to $4.80 per bushel, down from $4.25 to $5.25 per bushel last month.

That's still above current futures prices, Victor noted.

Corn and soybeans are used as animal feed by meat producing companies such as Tyson Foods Inc., Hormel Foods Corp. and Smithfield Foods Inc. Shares of those companies fell sharply late last month when the USDA reduced its estimates for corn and soybean production this year.

Some tumbled again on Monday's news. Shares of Springdale, Ark.-based Tyson, the world's largest meat producer, fell 60 cents, or 8 percent, to $6.86 in midday trading, while Sanderson Farms Inc., a chicken producer, fell $1.17, or 4.7 percent, to $23.99.

Pork-producing Smithfield's shares fell 34 cents, or 3.4 percent, to $9.70, while Hormel's shares rose 52 cents to $27.80.

Shares of the nation's largest chicken producer, Pilgrim's Pride Corp., fell 13 cents, or 15.5 percent, to 71 cents. The company said in late September it would post a ``significant loss'' in the fourth quarter, on high feed-ingredient costs, weak pricing and bad hedging of feed prices. It has not yet said when it will release its fourth-quarter results.

The chicken industry seems to be hurting most of all. Tyson said Monday grain costs climbed $230 million in its fiscal fourth quarter, accounting for a loss of $91 million in its chicken unit.

Despite the declines in projected harvests, this year's corn crop is still expected to be the second largest on record. The soybean crop is expected to be the fourth largest ever.

Monday's report comes as 86 percent of this year's soybeans, and 55 percent of the corn, have been harvested, the USDA said. That makes the projections more accurate than previous months.

The corn harvest is significantly behind its average pace, the USDA said, due to planting delays in the spring and cooler than average temperatures during the growing season.

AP Food Industry Writer Emily Fredrix contributed to this report from Milwaukee.