"Weather over the weekend here promoted ideas of a good start to the US winter wheat crop, with moisture around," said Jerry Gidel of North America Risk Management Services.
There was talk that high costs for fuel, fertiliser and other inputs needed for corn may sway farmers to plant more wheat this fall.
CBOT December wheat closed down 6-3/4 cents at $3.23-1/4 per bushel, with deferred months down 3 to 6-1/2 cents.
Volume was on the heavy side, estimated by the exchange at 43,126 futures and 7,043 options.
Most of the action took place in the first hour of trade as December fell through support at $3.26-1/4, a double-bottom on the contract's chart. December fell to $3.22-1/2, filling a slim 1/4-cent gap above $3.25-1/2 established on September 22.
Funds sold some 3,000 contracts on the day, with Refco Inc a featured seller of 2,000 lots, traders said.The next key support level looked to be at $3.20.
Wheat had added pressure from liquidation of the wheat/corn spread. The premium for December wheat over corn closed at $1.23 per bushel, down from $1.28-1/2 on Friday and $1.40 as recently as October 13.
After the markets closed, the US Department of Agriculture said the US winter wheat crop was 86 percent planted and 65 percent emerged, ahead of the 5-year averages of 84 percent and 63 percent, respectively.
In its first crop ratings of the season, USDA said 57 percent of the winter wheat was rated in good to excellent condition. That compares to 76 percent a year ago.
Weekly export inspections 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.
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.
Fund liquidation weighed on wheat futures in Kansas City and Minneapolis, where funds held heavy net long positions.
Friday's CFTC Commitments of Traders report showed funds were net long in Kansas City wheat combined futures and options by nearly 50,000 lots for the week ended October 18. Funds were net long MGE wheat futures and options by 10,306 lots.
For CBOT wheat, funds were net short by 11,439 contracts in combined futures and options.