By Phil Franz-Warkentin and Jade Markus, Commodity News Service
June 23, 2015
Winnipeg – ICE Futures Canada canola contracts were mostly lower on Tuesday, as the market corrected after hitting fresh highs on Monday.
The nearby July contract posted the largest losses, as speculators were liquidating positions ahead of first deliveries against the front month next week. Recent strength in the cash market was also said to be encouraging more farmer selling.
However, the new crop months lagged to the downside, as the hot and dry weather conditions across Western Canada remain a major supportive influence in canola, said traders.
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The nearby technical bias has also shifted higher, which makes any losses a good buying opportunity from a chart standpoint.
About 26,032 canola contracts were traded on Tuesday, which compares with Monday when 37,132 contracts changed hands. Spreading accounted for 17,778 of the contracts traded.
Milling wheat and durum were both untraded. However, barley saw some activity for the third day in a row, and moved lower in light two sided commercial activity.
SOYBEAN futures at the Chicago Board of Trade closed mixed on Tuesday, one to two cents higher per bushel, consolidating following recent sharp advances, analysts say. Good soybean seeding progress in India weighed on prices.
The monsoon is lending itself to good crop growing conditions in India, which had a bearish effect on prices.
On the other side, concerns about flooded crops in the US Midwest provided some support for prices.
SOYOIL settled weaker on Tuesday, weighed down by weakness in the price of Malaysian palm oil.
SOYMEAL prices settled weaker on Tuesday as analysts say there isn’t much market demand.
CORN futures closed four to eight cents per bushel higher on Tuesday amid declining crop conditions in the US, particularly in the Midwest, which is dealing with heavy rains and flooding.
The UDSA’s weekly crop report said 71 per cent of crops were good to excellent as of Sunday, down from 73 per cent the week prior.
However, softening ethanol demand and the strong US dollar were bearish.
WHEAT futures in Chicago were up 18 to 20 cents per bushel higher on Tuesday, amid concerns about winter-wheat harvest delays in the US, which is bullish according to analysts.
Like corn, wheat crop conditions in the US are deteriorating due to excess soil moisture. The UDSA said 41 per cent of winter wheat was good to excellent, down two percentage points.
Ongoing worries about dryness in Europe and Russia also underpinned values. Though, US spring wheat crop conditions are improving.
Settlement prices are in Canadian dollars per metric ton.
