By Phil Franz-Warkentin, Commodity News Service Canada
Winnipeg, Sep. 11 (CNS Canada) – ICE Futures canola contracts were weaker on Tuesday, taking some direction from the Chicago Board of Trade soy complex as traders adjusted positions ahead of Wednesday’s production report from the United States Department of Agriculture.
Seasonal harvest pressure added to the softer tone in canola, despite highly variable yield reports across the Prairies.
Chart-based speculative selling was also bearish, as prices dipped below nearby technical support.
However, recent cold and wet conditions in parts of Western Canada helped temper the declines.
About 7,990 canola contracts traded, which compares with Monday when 7,650 contracts changed hands. Spreading accounted for 2,450 of the contracts traded.
SOYBEAN futures were lower on Tuesday, as traders adjusted positions ahead of production estimates from the United States Department of Agriculture due out on Wednesday.
An increase in average U.S. soybean yields from the previous report is generally expected. World carryout stocks are also expected to be up.
Condition ratings for the U.S. soybean crop improved on the week, with 68 per cent now rated good-to-excellent – a two point increase.
The USDA announced net cancellations of 192,000 tonnes of pervious sales this morning.
CORN futures were slightly lower, taking some direction from soybeans and wheat.
The USDA reported a private sale of 138,000 tonnes of U.S. corn to South Korea, which provided some support.
U.S. corn condition ratings improved on the week, rising one point in the good-to-excellent category to 68 per cent.
Traders expect average corn yields will be revised lower in tomorrow’s USDA report, but supplies should still be large overall.
WHEAT futures were lower, as traders returned to the sell side after yesterday’s brief short-covering bounce.
The U.S. spring wheat crop was 93 per cent harvested as of this past Sunday, which compares with the average for this time of year of about 85 per cent done. Winter wheat seeding was underway in the south, at five per cent complete.
World wheat supply numbers will be followed closely in tomorrow’s report, with drought conditions in a number of key growing regions likely to cut into the overall stocks.