Wheat futures on the Chicago Board of Trade drifted lower on Tuesday on technical selling and consolidation, one day after the May contract set a one-month high, traders said. CBOT May wheat settled down 1-1/2 cents at $4.77-1/4 per bushel. K.C. hard red winter wheat and MGEX spring wheat futures also closed modestly lower.
All three US wheat markets were underpinned by a large net short position held by commodity funds, as well as worries about dry weather and a weekend freeze in the southern US Plains.
The cold is not likely to significantly harm the region's winter wheat but dryness should persist in the Plains through June, threatening crop prospects, a meteorologist said.
Otherwise, the fundamental outlook remains bearish, given weak export demand for US wheat supplies amid plentiful global stocks.
USDA late Monday rated 56 percent of the Kansas wheat crop as good to excellent, unchanged from the previous week.
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