It is a common problem. Nothing to worry. Enter as many characters as you can and leave the last characters that do not fit. You can explain the officer at consulate, if asked. The reason for this is that Machine Readable Zone has limit of 34 Characters and the Visa officer will use Visual Inspection Zone of the passport to validate that. Nothing to worry.
Though not directly related to the above system, you can check the SEVIS FAQs that talk about Long Surnames , which is a federal agency and has the same issue.