Expectations of big crop pressure canola lower

The Canadian dollar rose again putting downward pressure on Winnipeg canola futures.Also weighing on canola were thoughts that acreage might be larger than expected. Where crop has been seeded, there is excellent moisture. However, Saskatchewan Agriculture reported that only about 50 percent of the province’s crop was in the ground as of May 24, down from the five-year average of 81 percent.In east-central Saskatchewan, an important canola growing region, only 39 percent of crops had been seeded. Northeastern Saskatchewan was 43 percent complete. Western and southern areas were more advanced.Manitoba is mostly complete and Alberta was 66 percent complete as of May 20.Chicago soybeans rose on the firm cash market, rising crude oil and talk that late season growing conditions might turn dry if La Nina in the Pacific Ocean develops into a full blown system.The most active July canola contract fell $2.10 to $375.70 per tonne on 4,969 trades. The previous day’s best basis widened to -$3.95 per tonne off the July contract in the par region, according to the Winnipeg ICE Futures daily report.The 14-day Relative Strength Index for July canola was 32, according to BarChart.com. The rule of thumb is an RSI of 30 indicates an over sold market and 70 indicates over bought.New crop November canola fell $1.40 to $381.60 per tonne on 4.858 trades.The Canadian dollar at noon was 95.27 cents US, up from 93.89 cents at noon the previous trading day. The U.S. dollar at noon was $1.0496 Cdn.The loonie surged when China said Europe remains a key market for its foreign exchange reserves, ending worries that it might pull out of euro denominated assets because of the debt crisis there. China’s announcement gave investors confidence to move out of the safety of U.S. dollars.The Western barley contract saw trade for the first time in weeks as those holding the few contracts outstanding acted to get out before the July contract expires.Winnipeg barley July fell $2 to $143.50 on a volume of nine trades. December was untraded at $150.Chicago July soybeans rose 13.75 cents to $9.5175 US per bushel, new crop November rose 8.75 cents to $9.1875.May oats rose four cents to $1.965 per bu. December oats rose 3.5 cents to $2.16 per bu. In New York, crude oil for June delivery rose $3.04 to $74.55 per barrel.

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