GRAINS-Wheat inches higher but improved US crop weather limits gains

CANBERRA, May 20 (Reuters) - Chicago wheat futures edged higher on Tuesday amid concerns that frosts in Russia and dry conditions in China could damage output, but improved cropping conditions in the United States limited gains, holding prices near last week's five-year low.

Corn and soybean futures fell.

The most active wheat contract on the Chicago Board of Trade (CBOT) Wv1 was up 0.1% at $5.29-1/2 a bushel at 0511 GMT.

Prices fell to $5.06-1/4 on May 13, the lowest in five years.

"We will retest the low. But, whenever we do, we will find demand," said Ole Houe, head of advisory services at IKON Commodities in Sydney.

"As soon as northern hemisphere harvests are finished, I think prices will rise again. Farmers will be strong in holding back grain if they don't like the price."

Rains in the U.S. wheat belt have boosted the production outlook, and last week's Kansas crop tour projected the highest yield since 2021.

In Russia, Rostov, the largest grain-producing region, on Monday became the latest to declare a state of emergency for farming due to spring frosts.

Still, Russian wheat export prices remained unchanged last week, with the damage estimated at only about 10% of last year's level.

Commodity funds have built up a large net short position in CBOT wheat but were net buyers on Monday, traders said.

In other crops, CBOT soybeans Sv1 dipped 0.3% to $10.47-1/2 a bushel and corn Cv1 slipped 0.5% to $4.45-1/4 a bushel.

The U.S. Department of Agriculture said U.S. farmers had planted 78% of the nation's corn crop by Sunday, below most analysts' expectations. Soybean planting was 66% complete, slightly above most predictions.

Argentina's agricultural heartland has been lashed by heavy rains in recent days, bringing widespread flooding. The Buenos Aires grains exchange said it could be forced to trim its soybean harvest outlook.