By Phil Franz-Warkentin, Commodity News Service Canada
Winnipeg, March 16 (CNS Canada) – ICE Futures Canada canola contracts held onto small gains on Friday, seeing some follow-through buying to end the week as supportive technical signals kept speculators on the buy side.
Weakness in the Canadian dollar accounted for much of the strength in the futures, as the declining currency made exports more attractive to international buyers and also underpinned crush margins.
Gains in Chicago Board of Trade soybeans were also supportive.
However, ample old crop canola supplies and expectations for large seeded acres this spring tempered the upside.
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About 12,551 canola contracts traded on Friday, which compares with Thursday when 17,706 contracts changed hands. Spreading accounted for 6,170 of the contracts traded.
SOYBEAN futures at the Chicago Board of Trade moved higher on Friday, as production estimates out of Argentina continue to be revised lower. That kept beans underpinned despite the fact that the drought conditions there have been priced into the futures for some time now.
Thursday’s solid weekly export sales numbers and better-than-expected monthly crush demand remained supportive as well.
The United States Department of Agriculture reported an export sale of 20,000 tonnes of U.S. soyoil to unknown destinations Friday morning.
However, expectations for a sizeable increase in U.S. soybean acres this spring kept a lid on the market.
CORN futures settled with small losses, as spillover from the downturn in wheat more than made up for any support coming from the gains in soybeans. Large U.S. supplies and bearish technical signals also put some pressure on values.
However, the drought in Argentina did lend some support, as corn production estimates out of the South American country are also being revised lower.
WHEAT futures were lower, with the largest losses in the Chicago and Kansas City winter wheat contracts. The latest forecasts are calling for much needed rain in some parts of the dry southern U.S. Plains.
Improved moisture conditions in Russia and Ukraine were also bearish for the wheat markets, with large crops expected out of the Black Sea region once again.
