May wheat was trading 4 1/4 cents lower late in the overnight session. Outside market forces look slightly positive today. Open interest is down near 20,000 contracts in the last 5-6 days but traders are not sure if this comes from the March expiration soon or from short-covering. The market has seen an impressive recovery off of last weeks lows but seems to lack the supply threat to see much follow-through to the upside. Traders see the record net short position of fund traders as the key reason for the recovery bounce. Improving weather for the northern plains, however, looks to clash with a lack of much rain in forecast for the central and southern plains and traders see deteriorating crop conditions in western Kansas and Oklahoma as a potential supply threat ahead. May wheat closed slightly lower on the session yesterday after choppy and two-sided trade. The market saw some follow-through short-covering from fund traders to push the market to the highest level since February 8th early in the session. However, a turn down in equity markets, a sharp drop in metal prices and a rally in the US dollar helped to pressure the market. Higher trade for corn and soybeans helped to support the market late in the day. Trade estimates that about 1 million tonnes of damaged occurred to the French wheat crop due to recent cold weather helped to provide underlying support. News of a record India wheat production outlook this year for the 5th year in a row was seen as a negative force. Traders indicated that the warmer late winter weather in the plains has helped to speed up growth of the wheat crop and this leaves the crop vulnerable to freeze damage if there is a late season cold blast. There are also some growing concerns for the China wheat crop which has seen dry weather recently. There were no deliveries of wheat this morning as compared with 3 yesterday.