Worries about flooding in the upper U.S. Midwest and stronger crude oil prices lifted soybean prices Wednesday, supporting canola futures.
There is a difference of opinion about the seriousness of the risk from flooding. The snow pack in the upper Midwest was heavy, but unlike last year, there has been no rain in March.
Also, it is still only mid-March and there is lots of time for seeding to begin.
The U.S. dollar fell. Delays in Brazilian shipping were seen to be minimal.
Although the fundamental case for soybeans is still negative with harvest of the bumper South American crop progressing, the technical case strengthened with the May contract rallying above several moving averages.
The strong Canadian dollar limited canola’s gains. There were unconfirmed reports of new canola export business to Mexico and Pakistan.
The May canola contract rose $3.90 to $381.20 per tonne on 6,330 trades. The previous day’s best basis was steady at -$7.75 per tonne off the May contract in the par region, according to the Winnipeg ICE Futures daily report.
The 14-day Relative Strength Index for May canola rose to 41, according to BarChart.com. The rule of thumb is an RSI of 30 indicates an oversold market and 70 indicates overbought.
July rose $4.10 to $386.70 on 1,924 trades.
New crop November rose $3.50 to $388.60 per tonne on 1,434 trades.
The Canadian dollar at noon was 98.88 cents US, up from 98.54 cents at noon the previous trading day. The U.S. dollar at noon was $1.0113 Cdn.
The Winnipeg barley market again saw no action. May barley was steady at $154 on no trades and only 11 open interest contracts. July fell $4 to $150. December was steady at $150.
May soybeans rose 14 cents to $9.59 US per bushel. November soybeans rose 14.5 cents to $9.40 per bu.
May oats rose seven cents to $2.25 per bu.
Light crude oil for April delivery rose $1.23 to $82.93 per barrel on the weak U.S. dollar and a report that said weekly U.S. oil product demand was up 3.5 percent over last year at the same time.
The Canola Council of Canada holds its annual meeting in San Francisco Thursday and Friday. Watch Ed White’s blog on www.producer.com for daily coverage.
