North American Grain/Oilseed Review: Canola settles with small gains

By Phil Franz-Warkentin, Commodity News Service Canada

Winnipeg, Sep. 4 (CNS Canada) – ICE Futures canola contracts settled with small gains on Tuesday, as weather concerns in parts of the Prairies and weakness in the Canadian dollar provided support.

The Canadian dollar lost roughly half a cent relative to its United States counterpart, which helped crush margins improve on the day.

Cool and wet conditions in parts of Western Canada were also supportive, as the weather caused harvest delays and may have damaged some fields.

However, expectations that Statistics Canada will confirm large old crop supplies in a stocks report due out on Thursday, September 6, put some pressure on values.

About 14,257 canola contracts traded, which compares with Friday when 14,776 contracts changed hands. Spreading accounted for 5,620 of the contracts traded.

SOYBEANS settled within a penny of unchanged, retreating from earlier gains. Any strength was largely technical in nature as traders adjusted positions after the long weekend, with the underlying fundamentals looking relatively bearish for soybeans.

A lack of progress on the Chinese trade front put some pressure on values, while reports of a swine flu outbreak in China could lead to even lower demand from that country going forward.

Crop conditions across the Midwest remain reasonably favourable and general expectations are for a big crop this year.

CORN futures ended higher. Argentina announced it was placing export tariffs on corn and wheat as part of austerity measures in response to last week’s economic meltdown in the South American country.

Those tariffs should slow corn exports and also lead to reduced plantings, which should open up some export opportunities for US corn.

However, sharp losses in wheat weighed on corn prices.

All three U.S. WHEAT markets were lower on the day. While the Argentina news was also supportive for U.S. wheat, prices dropped sharply in reaction to news out of Russia.

Russia has said that it will not be limiting wheat exports, despite this year’s smaller drought-stricken crop. That means cheap Russian wheat should continue to cut into the demand for North American supplies for the time being.

The strengthening U.S. dollar also weighed on wheat.

Futures Prices as of September 4, 2018

Canola
2018-09-04 13:19
Price Change
Nov 496.80 1.20
Jan 504.00 1.50
Mar 508.40 1.60
May 511.50 2.00
Milling Wheat
1970-01-01 00:00
Price Change
Durum
1970-01-01 00:00
Price Change
New Barley
1970-01-01 00:00
Price Change

Prices are in Canadian dollars per metric ton

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