Canola futures on the Winnipeg ICE Exchange closed lower Wednesday on a sharp fall in Chicago soybean prices.
Federal labour minister Rona Ambrose announced during the afternoon that last minute negotiations between the Canadian National Railway and its striking locomotive engineers had reached a deal, eliminating the need for back to work legislation. The rail service disruption that began Saturday had not yet caused a significant backup in grain shipments.
Statistics Canada will release its final production estimate of the year tomorrow. Analysts expect it will increase the size of western Canadian crops from its October report.
Prime minister Stephen Harper is in China this week. The issue of China’s restriction on Canadian canola imports is expected to be a priority topic for discussion with Chinese leaders.
January canola settled Wednesday at $409.70 per tonne, down $3.90 from Tuesday on a volume of 12,541 contracts.
March fell $4 to close at $416.40 per tonne on a volume of 4,444 contracts.
The Bank of Canada at noon Wednesday said the Canadian dollar was worth 95.53 cents US, down from 95.86 cents Tuesday. The U.S. dollar was worth $1.0468 Cdn.
The Winnipeg January barley contract was steady at $160.50 per tonne with no trades. March was steady at $162 per tonne with no trades.
After strong gains Tuesday, Chicago January soybeans slumped 25.5 cents to $10.34 US per bushel, weighed down by the stronger U.S. dollar, weaker crude oil prices, profit taking and commercial hedge selling.
All grain markets were weakened by a U.S. decision Tuesday to delay a ruling on increasing the ethanol content in gasoline to 15 from 10 percent.
Markets are waiting to see if big investment funds will continue to put money in agricultural commodities.
Crude oil dropped after Iran released British yachtsmen picked up the previous day when they strayed into Iranian waters. Also, weekly U.S. oil and fuel inventory report showed stocks increased.
