By Dave Sims and Erin DeBooy, Commodity News Service Canada
Winnipeg, August 26 – THE ICE Futures Canada canola market eked out tiny gains on Friday, as traders engaged in chart-based trading before the weekend.
The market was underpinned by wet weather, which has cut into expectations for the size of this year’s crop. This week, Statistics Canada pegged canola production at 17 million tonnes, which was below what most analysts had been expecting.
“Seventeen million tonnes isn’t nearly a big enough crop if China is in the game. We’ll run out of canola by March with a crop like that,” said a trader in Winnipeg.
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The Canadian dollar was weaker compared to its US counterpart, which made canola more attractive to out-of-country buyers.
Gains in crude oil and Chicago Board of Trade soyoil lent some support to the market.
However, China is planning to lower the amount of foreign material it accepts in shipments of Canadian canola on September 1, which could cut into the amount of supplies Canada ships to them.
The US is expected to harvest a massive soybean crop this year, which was bearish for values.
Around 15,013 canola contracts were traded on Friday,
which compares with Thursday when around 16,346 contracts changed hands.
Milling wheat, barley and durum were all untraded.
Settlement prices are in Canadian dollars per metric tonne.
SOYBEAN futures at the Chicago Board of Trade fell between seven and eight US cents on Friday with strong harvest projections.
The annual Pro Farmer Midwest crop tour projected a 2016 soybean harvest of 4.093 billion bushels, weighing on prices.
US soybean yields were estimated to be 49.3 bushels per acre, higher than the USDA outlook of 48.9 bushels per acre.
SOYOIL strengthened on Friday.
SOYMEAL weakened on Friday.
CORN futures fell around seven US cents per bushel on Friday with strong harvest projections.
The Pro Farmer crop tour projected record corn crops, estimating yields of 170.2 bushels per acre, weighing on prices.
However, the large yields are below the USDA’s outlook of 175.1 bushels per acre, limiting gains.
WHEAT dropped on Friday, plummeting 16 to 17 US cents, with the September contract slipping below US$4 per bushel.
Wheat hit a fresh 10-year low amid pressure from the US spring wheat harvest, and expectations that Egypt will purchase more competitive Russian grain in an international tender.
-Despite the large Canadian wheat crop this year, higher quality wheat might be in short supply, according to reports. Excess moisture is causing disease issues and frequent rain is causing harvest delays, which also can downgrade quality.
– Wheat harvest in Southern England is nearing completion, and although yields are slightly below average, the quality is good, showing high protein contents, according to reports.
