Hedging, weaker soy push canola lower

Commercial hedging, weaker soybeans and the stronger loonie pushed canola down sharply Wednesday.There was also some long liquidation ahead of Statistics Canada’s production report due Friday.The forecast for the possibility of rain in central Saskatchewan for Sunday and Monday has changed and drier weather is expected.Soybeans fell as cooler weather moved into the U.S. Midwest, raising hopes for a record large soybean crop.A Reuters survey in advance of the Statistics Canada report said the average of analysts’ forecast for the canola crop was 10.7 million tonnes, up from the Agriculture Canada July forecast of 10.5 million.The survey showed analysts on average expect a 2.2 million tonne oat crop, down from Agriculture Canada’s July forecast of 2.47 million.The all wheat crop was seen as 21.2 million tonnes, roughly in line with the Canadian’s Wheat Board’s forecast.In Winnipeg, November canola fell $7.60 per tonne to $459.70 on 10,530 trades.The January contract fell $7.80 to $463.40 on 555 trades.The previous day’s best basis was $15.13 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 was 58 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 97.19 cents US, up from 96.97 the previous trading day. The U.S. dollar at noon was $1.0289. The loonie continued to be supported by BHP Billiton’s hostile takeover attempt on PotashCorp. If successful, the multi-billion dollar deal would have to be conducted in Canadian currency. Some analysts believe the deal could push the loonie to par with the U.S. dollar.Winnipeg October barley was steady at $168 and December rose $3 to $182 on 10 trades.Chicago September soybeans fell 10 cents to $10.3525 US per bushel. New-crop November fell 11.25 cents to $10.3075.September oats rose 1.25 cents to $2.7675 per bu. December oats rose 1.25 cents to $2.8975 per bu. In New York, crude oil for September delivery fell 35 cents to $75.42 US per barrel.

Your reading list