Good growing weather in Western Canada and expectations of big U.S. crops pressured canola futures lower Wednesday.
Weak demand added to the downward pressure.
Some news services reported traders are increasing their estimate of the canola crop to 11 million tonnes from 10 to 10.5 million thanks to recent good weather.
Statistics Canada is set to release its production survey results Aug. 20.
A weaker Canadian dollar limited the losses in canola.
Soybeans were mixed with old crop August, which expires Friday, rising in light trade, but new crop November falling.
Traders were positioning ahead Thursday’s U.S. Department of Agriculture American and world production and demand report. The report is expected to forecast bumper U.S. crops.
Traders are looking for a corn average yield of at least 164.08 bushels per acre. Anything less would be considered bullish to corn prices.
Heavy rain hit western areas of the corn belt in the U.S. Midwest causing localized flooding.
Ukraine said it was considering grain export restrictions because of its weather-damaged crop. The country said it would make a decision on export quotas next week.
In Winnipeg, November canola fell $4.60 per tonne to $457.40 on 15,356 trades.
The January contract fell $5.80 to $459.60 on 2,988 trades.
The previous day’s best basis was unchanged at $18 per tonne under the November contract in the par region, according to the Winnipeg ICE Futures daily report.
The 14-day Relative Strength Index for November fell to 46 according to BarChart.com. The rule of thumb is an RSI of 30 indicates an over sold market and 70 indicates an over bought market.
The Canadian dollar at noon was 95.64 cents US, down from 96.64 the previous trading day. The U.S. dollar at noon was $1.0456 Cdn.
The U.S. Federal Reserve issued a gloomy report on the U.S. economy and said low interest rates must continue to support the sluggish economic recovery in the United States.
Canada’s trade deficit in June was three times higher than expected, indicating Canada’s economy is also struggling.
Winnipeg barley was steady and untraded. October was $168 and December $180.
Chicago August soybeans rose 8.25 cents to $10.445 US per bu. September fell 4.5 cents to $10.165. New crop November fell 6.5 cents to $10.155.
September oats fell 2.25 cents to $2.6925 per bu. December oats fell two cents to $2.82 per bu.
In New York, crude oil for September delivery fell $2.23 to $78.02 per barrel.
