By Phil Franz-Warkentin
Glacier FarmMedia MarketsFarm – The ICE Futures canola market was weaker on Wednesday, failing to hold onto earlier gains as losses in Chicago soyoil and European rapeseed futures accounted for some spillover selling pressure.
Increased farmer selling after the gains posted earlier in the week were also thought to be weighing on values.
However, talk of export demand underneath the market provided some support, with China rumoured to have made some purchases of Canadian canola recently.
Weakness in the Canadian dollar, after the Bank of Canada left its key overnight rate unchanged at five per cent earlier in the day, also provided some support.
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There were an estimated 34,178 contracts traded on Wednesday, which compares with Tuesday when 35,627 contracts traded. Spreading accounted for 21,080 of the contracts traded.
WHEAT futures in the United States posted solid gains on Wednesday, with Chicago soft winter wheat leading to the upside as it moved above several key moving averages which brought in additional speculative buying.
Renewed uncertainty over the conflict in Ukraine was also thought to be underpinning the wheat market, after the crash of a Russian plane carrying Ukrainian prisoners of war.
Forecasts call for some beneficial moisture over the U.S. Southern Plains over the next week, tempering the advances to some extent, especially as warmer temperatures should limit the risk of any damage to overwintering crops for the time being.
SOYBEANS traded to both sides of unchanged, with the nearby March contract holding onto a small gain at the final bell while the more deferred months drifted lower. The products were mixed, with losses in soyoil but gains in soymeal.
The advancing Brazilian harvest, which is still in its early stages, put some pressure on the market as new crop supplies will soon start to become available from the country.
However, forecasts calling for hot and dry weather in Argentina were supportive, as the crop there is still months away from harvest. Demonstrators in Argentina staged a nationwide strike on Wednesday, closing businesses and schools, in opposition to newly elected President Javier Milei’s libertarian policies.
CORN was underpinned by speculative short covering, as values continued to recover off last week’s lows.
Weekly U.S. ethanol data showed production of the renewable fuel dropped sharply in the past week, falling to 818,000 barrels per day. That marked the lowest level in three years and the first sub-million-barrel week in 17 weeks.
Brazil’s second corn crop is estimated to be about five per cent seeded, which compares with only one per cent at this time last year.
