On the Chicago Mercantile Exchange, wheat futures for May delivery traded at USD6.4038 a bushel during European morning trade, dropping 0.4%.
It earlier fell by as much as 0.55% to trade at USD6.3975 a bushel, the lowest since March 12.
Wheat prices have lost nearly 5% since the start of the week, including a 3% plunge on Monday after Russian Prime Minister Vladimir Putin said that the nation will not limit grain exports this year.
Russia, once the world's third largest grain exporting nation, introduced an 11-month ban on grain exports in August 2010 after the worst drought in at least half a century wiped out a third of its grain crops.
Russia is a major wheat exporter and competes with the U.S. for business on the global market. An upbeat Russian grain export outlook could weigh on demand for U.S. supplies, which is the world’s third largest wheat producer and biggest exporter.
Market talk of hedge funds and large institutional investors liquidating long positions amid bearish chart signals also added to the selling pressure.
Meanwhile, favorable weather conditions in the southern U.S. Great Plains winter-wheat belt continued to weigh on prices.
Agricultural meteorologists forecast significant rainfall throughout the region, which can potentially boost crop development.
In Kansas, the top US wheat-growing state, the U.S. Department of Agriculture rated the winter crop at 53% in "good" or "excellent" health, far better than the 27% last year.
In Texas, parts of which saw rains of up to two inches last week, the rating improved to 34% good or excellent, from 33% a week ago.
"Rainfall and warm temperatures helped wheat and oats progress well across most of the state," the USDA said.
Despite the recent slump in prices, Societe Generale said in a report Tuesday that it was “bullish” on wheat and expected prices to rise to USD7.80 a bushel in the second half of 2012.
"We see upside potential for wheat prices as a result of further animal food substitution from corn wheat and potential output shortfalls in parts of Europe due to extreme cold winter," the bank said.
Elsewhere on the Chicago Mercantile Exchange, corn for May delivery shed 0.3% to trade at USD6.4538 a bushel, while soybeans for May delivery traded at USD13.4613 a bushel, easing up 0.1%.