MGE December wheat ended down 5 cents at $3.66-1/2 per bushel. Deferred months were down 2-1/2 to 5-3/4 cents. Volume was estimated by the exchange at 4,404 contracts, up from 3,850 on Friday.
Funds were light sellers of about 500 contracts, traders said. ADM Investor Services was a featured seller of about 600 December while Reface Inc and UBS Warburg was a buyer.
Hedge selling was minimal, with farmers opting to store their grain and hold out for higher prices. "They are not too impressed at these levels," one trader said.
Chicago wheat futures set the tone in the session, falling through technical support amid selling by funds. Weekly export inspection data was neutral.
The US Department of Agriculture reported inspections of wheat at 20.9 million bushels, within the range of estimates for 18 million to 23 million.
Favourable crop weather in US winter wheat areas was bearish. Meteorlogix weather service said conditions in the US Plains were conducive to planting and emergence of the 2006 hard red winter wheat crop.
There was talk that high costs for fertiliser and other inputs needed for corn may sway farmers to plant more wheat this fall. On Friday's CFTC Commitments of Traders report showed funds were net long in Minneapolis wheat combined futures and options by 10,306 lots for the week ended October 18.
Funds were long nearly 50,000 lots of KCBT wheat, while funds were net short in CBOT wheat by 11,439 contracts. Exports were quiet over the weekend.
Customs data showed exports of UK wheat nearly doubled during the first two months of the 2005/06 season (July-June) to 309,294 tonnes, compared with 166,049 tonnes at the same time last year.