By Phil Franz-Warkentin, MarketsFarm
WINNIPEG, Feb. 25 (MarketsFarm) – The ICE Futures canola market was weaker on Thursday, posting limit-down losses in some months as speculators liquidated long positions.
Ideas that canola was looking overbought, after hitting record highs earlier in the week, contributed to the losses.
Losses in the Chicago Board of Trade soy complex added to bearish sentiment in canola.
However, the underlying fundamentals remained supportive amid expectations for tightening old supplies.
A turn lower in the Canadian dollar, as it backed away from three year highs relative to its United States counterpart, also lent some support to canola.
About 38,999 canola contracts traded on Thursday, which compares with Wednesday when 45,254 contracts changed hands. Spreading accounted for 12,230 of the contracts traded.
SOYBEAN futures at the Chicago Board of Trade were down sharply on Thursday, as disappointing weekly United States soybean export sales provided the catalyst for a profit-taking selloff.
The U.S. Department of Agriculture reported that only 167,900 tonnes of old crop soybeans were sold during the week, with an additional 70,800 tonnes of new crop business.
The exports were well below expectations and marked the smallest weekly total since Christmas. Soyoil and meal sales were also below expectations.
Improving crop prospects out of South America also weighed on prices, although rain delays in parts of Brazil due to recent rains did provide some support.
CORN futures were also pressured by poor weekly exports.
Weekly U.S. corn export sales for movement during the current crop year of 453,000 tonnes were down 85 per cent from the previous four-week average and well below trade guesses. Last week’s Lunar New Year holiday in China was likely behind the slow sales.
However, delays seeding Brazil’s corn crop did provide some support.
WHEAT futures were lower as well. Weekly U.S. wheat export sales came in at 167,700 tonnes, which was the smallest weekly total in nearly a year.
Ideas the recent U.S. cold snap did not cause as much damage to the winter wheat crop as some had feared added to the softer tone.
The International Grains Council pegged world wheat production this year at 773 million tonnes. That would be up by five million from an earlier estimate and a 1.4 per cent increase on the year.