WASHINGTON (Reuters) - Searing summer drought slashed U.S. corn production to the lowest level in six years and soybeans to the lowest in nine years, the government forecast on Wednesday, but the corn crop is larger than expected, which will relieve the third year in a row of tight supplies.

With the fall harvest running faster than usual, the Agriculture Department lowered its corn forecast by less than 1 percent; traders had expected a cut of nearly 4 percent from August. The surplus at the end of this marketing year would be the smallest since 1996 but 24 percent larger than the trade expectation.

USDA cut its forecast of the soybean crop by 2 percent from its August figure, twice the cut expected by traders. It said the carry-over at the end of the marketing year would be the smallest in eight years although slightly larger than expected.

Besides the United States, drought damaged the wheat crop in Russia and its neighbors. Russia's crop was 39 million tonnes, down 9 percent from the August estimate and the second large cut in a row. Kazakhstan's crop was reduced 4.5 percent by USDA.

World wheat supplies are only marginally lower despite the losses, said USDA, and feed grain production also is down less than 1 percent, compared to August forecasts. The world wheat crop is down 5 percent from last year and coarse grains down 2.4 percent. World rice production is on par with last year.

Leaders of the Group of 20 wealthy nations said the U.S. forecasts would help determine if an emergency meeting is needed to constrain an upsurge in food prices. France suggested on Tuesday the creation of strategic stocks to buffer food price gyrations.

U.S. livestock producers have petitioned the Obama administration for relief from a requirement to use corn-based ethanol in gasoline.

(Reporting by Charles Abbott)