By Phil Franz-Warkentin
Glacier FarmMedia MarketsFarm – The ICE Futures canola market settled with small losses on Tuesday after trading to both sides of unchanged in choppy activity.
A downturn in the Chicago soy complex accounted for some of the spillover selling pressure in canola, although European rapeseed and Malaysian palm oil were both higher on the day.
Chart-based positioning was a feature, with the May contract consolidating around its 20-day moving average.
While some technical signals indicate that a low may be in for the time being, increased farmer selling on any attempts at correcting higher likely kept a lid on the upside, according to participants.
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Statistics Canada releases planted acreage estimates on Monday, March 11, with trade opinions divided on whether seeded canola area will be up or down from the 22.1 million acres planted in 2023.
There were an estimated 34,095 contracts traded on Tuesday, which compares with Monday when 26,349 contracts traded. Spreading accounted for 18,720 of the contracts traded.
SOYBEAN futures at the Chicago Board of Trade were weaker on Tuesday, with positioning ahead of Friday’s monthly United States Department of Agriculture supply/demand estimates behind some of the activity.
Friday’s report will include updated South American production estimates. The USDA has consistently called for a larger soybean crop in Brazil compared to other forecasters, and traders will be watching to see if the government agency finally cuts their number to be more inline with other trade guesses. The USDA pegged Brazil’s soybean production at 156 million tonnes in its February report, which compares with other guesses already well below 150 million tonnes.
Adjustments to U.S. ending stocks will also be watched, with average trade guesses calling for only minor changes from the 315 million bushels forecast in February.
CORN was pressured by chart-based selling after running into resistance yesterday.
Average trade guesses call for smaller Brazilian corn production and tightening U.S. stocks in Friday’s report.
WHEAT was weaker across the board, pressured by ideas that U.S. wheat remains uncompetitive compared to other origins especially as cheaper Russian wheat continues to make its way into export channels.
Relatively favourable conditions for the U.S. winter wheat crop also weighed on values. However, weekly data from Kansas, Texas and Oklahoma showed small declines in the good-to-excellent ratings for all three states.
