By Phil Franz-Warkentin
Glacier FarmMedia MarketsFarm – The ICE Futures canola market dropped sharply lower on Thursday, as losses in the Chicago soy complex and bearish technical signals weighed on values.
Short-term momentum indicators in the canola market had turned overbought, likely signalling an end to the recent uptrend in canola, according to an analyst. In addition, the nearby March contract briefly traded above its 20-day moving average earlier in the week, before running into resistance.
European rapeseed was also weaker, while the Malaysian palm oil market was closed for a holiday.
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A lack of significant end user demand on the other side was another bearish influence, although some bargain hunting likely came forward on a scale-down basis.
There were an estimated 34,614 contracts traded on Thursday, which compares with Wednesday when 34,178 contracts traded. Spreading accounted for 21,080 of the contracts traded.
SOYBEAN futures at the Chicago Board of Trade took back their gains from earlier in the week on Thursday, pressured by bearish technical signals and soft weekly export sales.
Weekly United States soybean export sales fell well short of expectations at roughly 561,000 tonnes. However, soymeal sales were solid at about 256,000 tonnes.
The soybean harvest in Brazil was moving along, at about six to seven per cent complete nationally, according to reports. However, rains in the forecasts could cause some delays. Meanwhile, hot and dry weather in Argentina provided some support, as soybeans there are still months away from harvest.
CORN held closer to unchanged, posting small losses at final bell.
Weekly U.S. corn export sales included about 955,000 tonnes of old crop business and an additional 37,600 tonnes to move in the net marketing year. Sales were down from the previous week, but ahead of the four-week average.
Early estimates ahead of spring seeding call for a slight reduction in US corn acres on the year.
The USDA’s Ag Attaché in China forecast the country will import 20 million tonnes of corn this year, which would be three million tonnes off the U.S. Department of Agriculture’s official estimate.
Rains across northern Brazil will likely delay the soybean harvest and seeding of the second corn crop but will be good for development of the corn in the long run.
WHEAT was steady to higher, with the largest advances in hard red winter wheat.
Weekly U.S. wheat export sales were in line with expectations – with about 451,000 tonnes of old crop business and an additional 59,000 tonnes of new crop.
Ongoing geopolitical tensions kept some caution in the wheat trade.
