By Phil Franz-Warkentin, Commodity News Service Canada
Winnipeg, April 3 (CNS Canada) – ICE Futures Canada canola contracts were stronger on Tuesday, finding some support from advances in Chicago Board of Trade soyoil.
Bullish chart-signals contributed to the gains, although canola ran into some resistance to the upside as values neared their best levels of the past month.
The Canadian dollar was also stronger on the day, which tempered the upside potential in canola and caused crush margins to weaken.
Increased farmer hedges and a lack of significant commercial demand also put some pressure on values.
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About 20,904 canola contracts traded on Tuesday, which compares with Monday when 21,206 contracts changed hands. Spreading accounted for 12,348 of the contracts traded.
SOYBEAN futures at the Chicago Board of Trade were stronger on Tuesday, with chart-based buying a feature as the market saw a technical recovery after yesterday’s losses.
The 165 million bushels of soybeans crushed in the United States in February was a new record for the month, adding to the firmer tone in the futures.
Declining production estimates out of Argentina and the smaller-than-expected soybean acres in last week’s USDA prospective plantings report remained supportive as well.
However, ample old crop stocks and mounting concerns over a trade dispute between the U.S. and China kept a lid on the upside.
WHEAT futures posted sizeable gains, with Kansas City hard red winter wheat leading to the upside.
The U.S. winter wheat crop was rated 32 per cent good-to-excellent in the latest USDA report, which came in below trade expectations and compares to this time a year-ago when roughly half of the country’s winter wheat was in the top two categories.
Meanwhile, 30 per cent of the U.S. winter wheat was rated poor-to-very-poor; well above the 14 per cent at this time last year.
Poor weather across the Plains was also supportive for prices, with temperatures too hot in the south and too cold in the north.
CORN futures followed wheat higher. Corn seeding in the southern U.S. is moving forward at a steady pace, according to the latest USDA report, with Texas and Mississippi both running well ahead of average for this time of year.
However, cool and wet conditions to the north are expected to cause seeding delays in the eastern Corn Belt.
