U.S. wheat dropped to its lowest level in five weeks on Monday, falling for a fifth session out of six, as forecasts for widespread rains across the U.S. Plains over the weekend eased worries about yield losses.
Soybeans edged up to hit an eight-month high, still underpinned by forecasts of lower U.S. plantings for 2016, while corn slipped, snapping six sessions of gains.
The most-active wheat contract on the Chicago Board Of Trade was down 1.1 percent to $4.55 by 1106 MT after falling as much as 5.53-1/2 a bushel in earlier trade.
European markets followed in early trade, falling to 151.75 euros a tonne, close to a contract low of 151.00 euros. Soybeans rose 0.55 percent at 9.21-1/2 after hitting 9.23-3/4 earlier, highest since August 17, while corn fell 0.6 percent to $3.60-1/4 a bushel.
"We have been looking at a long-term weather forecast which calls for rains in the U.S. Plains. This pattern seems to have strengthened and now heavy rainfall is expected over Saturday and Sunday," an Australia-based agricultural commodities analyst said. "If they get that rain, it takes away the only bullish factor for wheat prices."
Chicago wheat prices are already under pressure with U.S. exporters facing difficulties in selling amid competition from cheaper suppliers in Europe and the Black Sea region.
The USDA reported lower-than-expected weekly export sales for wheat on Thursday.
Hefty supplies, large expected crops and poor U.S. exports will weigh on grain prices later this year, with corn and wheat set to drop to 10-year lows as harvest nears, consultancy AgResource said on Friday.
Large speculators increased their net short position in CBOT corn futures in the week to April 5, regulatory data released on Friday showed.
The Commodity Futures Trading Commission's weekly commitments of traders report also showed that non-commercial traders, a category that includes hedge funds, trimmed their net short position in CBOT wheat and cut their net long position in soybeans.
Traders were also awaiting the U.S. Department of Agriculture's April crop supply/demand report due on Tuesday, which will estimate 2015/16 global ending stocks for wheat, corn and soybeans.