* The US dollar index rose sharply as deteriorating fiscal outlooks in the United States and Europe prompted investors to cut exposure to riskier assets. * Also bearish for grains and soy, US crude oil futures fell and the Dow Jones industrial average dropped more than 250 points. * Favorable weather in South American soy regions added pressure. Brazilian farmers have planted 71 percent of the 2011/12 soybean crop, up from 58 percent a week earlier and ahead of the five-year average of 70 percent, analysts Celeres said. Good rains since September have aided progress. * US soybean export inspections data was disappointing. USDA reported inspections of US soybeans in the latest week at 40.762 million bushels, below trade estimates for 45 million to 50 million. * Trade slowed ahead of the US Thanksgiving Day holiday on Thursday, with volume in soybean futures down about 40 percent from the prior 30-day average. * The apparent shortfall of customer funds at MF Global Holdings Ltd's broker-dealer unit may be around $1.2 billion, about double initial estimates from regulators, the trustee liquidating the company said. * Friday is the last trading day for CBOT December options.