North American Grain and Oilseed Review: Weaker Chicago soyoil pulls down canola

By Glen Hallick, MarketsFarm

WINNIPEG, Feb. 10 (MarketsFarm) – Intercontinental Exchange (ICE) Futures canola contracts finished lower Monday, following declines in Chicago soyoil.

Protests in Vancouver could result in slowing rail traffic and exports, according to a trader. The demonstrators have been supporting the Wet’suwet’en’ Nation in their fight against the Coastal GasLink pipeline crossing their traditional territory in British Columbia.

The trader also said the funds and speculators were somewhat short on canola. Short-covering on those positions would provide some support.

By mid-afternoon Monday, the Canadian dollar was down by a tenth of a cent at 75.06 U.S. cents.

There were 26,734 contracts traded on Monday, which compares with Friday when 27,184 contracts changed hands. Spreading accounted for 21,278 contracts traded.

Settlement prices are in Canadian dollars per metric tonne.

Price Change
Canola Mar 459.80 dn 1.50
May 469.00 dn 1.60
Jul 476.10 dn 1.40
Nov 482.90 dn 1.00

SOYBEAN futures at the Chicago Board of Trade (CBOT) were higher on Monday, positioning ahead of tomorrow’s supply and demand report from the United States Department of Agriculture (USDA).

Trade expectations for the monthly World Supply and Demand Estimates (WASDE) predicted a 5.6 per cent reduction in the carryover for U.S. soybeans, to approximately 448.3 million bushels. The global carryover is expected increase to 97.3 million tonnes, for a gain of 600,000 tonnes from the January estimates. That’s largely due to increases in Brazil’s production to an average prediction of 123.7 million tonnes, and Argentina’s production to surpass 52.0 million tonnes.

The USDA reported export inspections of soybeans came to 603,852 tonnes for the week ended Feb. 6. That’s a drop of more than 47.5 per cent from the same week last year. However, at this point in the current marketing year inspections were at 27.22 million tonnes, which was 4.49 million tonnes ahead of the previous year.

A report stated that Chinese President Xi Jinping assured U.S. President Donald Trump that China would soon begin its purchases of more agricultural goods from the U.S. This would be despite the coronavirus outbreak in which most of the reported cases and nearly all of the death have been in China.

CORN futures were lower on Monday due to technical selling.

Market predictions pegged the U.S. corn carryover to be about 1.9 billion bushels, for a decline of 12.3 million bushels from last month’s WASDE. The global carryover was projected to be 297.2 million tonnes.

The USDA’s exports inspections put corn at 760,390 tonnes for the week, which was a gain of 16,632 tonnes from the previous week. Corn export inspections to date amounted to 11.49 million tonnes, which less than half the inspections this time last year.

WHEAT futures were lower on Monday, with losses in Chicago and Minneapolis while Kansas City was unchanged.

Tomorrow’s supply and demand report is expected to see U.S. ending stocks to be about 959.0 million bushels, for a drop of 6.1 million. The global wheat carryout is expected to be 287.5 million tonnes, a decline of 600,000 tonnes from January’s estimate.

The USDA reported weekly export inspections of wheat came 523,713 tonnes. That brought total inspections so far this marketing year to 17.185 million tonnes, which was about 11.7 per cent ahead of the pace this time last year.

In international purchases, Algeria issued a tender for 50,000 tonnes for an April delivery, and Turkey issued a tender for 250,000 tonnes with a March delivery.

Futures Prices as of February 10, 2020

Canola
Price Change
Milling Wheat
1970-01-01 00:00
Price Change
Durum
1970-01-01 00:00
Price Change
New Barley
1970-01-01 00:00
Price Change

Prices are in Canadian dollars per metric ton

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