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Chicago wheat fell 3% to its lowest in about six weeks on Monday, with downward pressure generated by expectations that a U.S. government report on Monday will show a rapidly advancing wheat harvest in the United States.
Corn and soybeans also fell, with the focus on favourable corn crop weather in the United States. The strong trend in the dollar also makes U.S. grains and soybeans more expensive in export markets.
"Seasonal conditions continue to improve in North America and Australia," said Commonwealth Bank analyst Dennis Voznesenski. "Northern Hemisphere harvest has started, and when there's new supplies coming online, it typically suppresses prices."
The Chicago Board of Trade's most active wheat contract fell 3% to $5.94-1/4 a bushel by 1226 GMT, testing the psychologically important $6.00 level. The contract earlier hit $5.93 for its lowest since May 1.
Corn was down 1% at $4.45-1/2 a bushel and soybeans fell 1.3% to $11.64-1/4 a bushel.
Traders are monitoring U.S. weather as corn crops approach a key development period and U.S. winter wheat harvesting gathers pace. The U.S. Department of Agriculture (USDA) is scheduled to report on U.S. crop progress later on Monday.
“I think the market is expecting a positive report of U.S. wheat harvest progress from the USDA later today while the USDA is also likely to give a positive picture of U.S. corn,” one European trader said.
“Soybeans are being weakened by the firm dollar, which is bad news for U.S. exports of soybeans at a time of strong competition, especially from Brazil.”
Rain in dry regions of Russia and Ukraine has offered some relief for wheat and corn, though benefits could be limited for wheat with harvesting looming, analysts said.
Crop conditions for French soft wheat were steady last week, but harvest prospects in the European Union's biggest producer remained poor after rain.
(Reporting by Michael Hogan in Hamburg Additional reporting by Naveen Thukral in Singapore Editing by Sherry Jacob-Phillips, Rashmi Aich and David Goodman)