By Phil Franz-Warkentin, MarketsFarm
Winnipeg, June 25 (MarketsFarm) – The ICE Futures canola market was down sharply on Tuesday, breaking below nearby chart support as speculators turned to the sell side.
Recent rainfall across Western Canada accounted for some of the selling pressure, as dryness concerns have alleviated somewhat. Losses in Chicago Board of Trade soybeans and soyoil also weighed on values.
However, many of the driest canola growing areas of Saskatchewan only received minimal precipitation, and total canola production is expected to be down on the year.
Statistics Canada will release updated acreage estimates on Wednesday, June 26. General expectations are for a decline in the canola number from earlier estimates, but the extent of the revision remains to be seen.
About 22,315 canola contracts traded on Tuesday, which compares with Monday when 17,686 contracts changed hands. Spreading accounted for 12,978 of the contracts traded.
SOYBEAN futures at the Chicago Board of Trade were weaker on Tuesday, retreating from earlier gains by the close.
The United States soybean crop was 85 per cent seeded as of this past Sunday, according to the latest weekly U.S. Department of Agriculture report. That was well behind the 5-year average of 97 per cent done.
While the slow seeding pace was supportive, the market ran into resistance to the upside, as forecasts calling for some better weather over the next week should allow farmers to get in more of the bean crop.
The USDA will release updated acreage estimates on Friday, but traders are uncertain if this report will show the extent of the lost acres due to wet weather.
Optimism over U.S. and China trade relations provided some support, as the leaders of the two countries are set to meet at the G20 in Japan later this week.
CORN held onto small gains in the most active months on Tuesday.
The U.S. corn crop was 96 per cent seeded in the latest report – with the last four per cent of intended acres unlikely to be planted at this time.
Condition ratings declined four points on the week, to come in at 55 per cent good-to-excellent. Development was running behind normal.
WHEAT was narrowly mixed on the day, with gains in Minneapolis spring wheat and a steady to softer tone in the winter wheats.
U.S. wheat condition ratings declined in the latest weekly report, with spring wheat down two points at 75 per cent good-to-excellent and winter wheat down three points at 61 per cent good to excellent.
The U.S. winter wheat harvest was 15 per cent complete, which is well off the 34 per cent average for this time of year.
Hot and dry weather in Europe was also supportive for wheat.