By Phil Franz-Warkentin and Dave Sims, Commodity News Service
Winnipeg, August 10 – ICE Futures Canada canola contracts were stronger on Monday, taking most of their direction from a rally in the CBOT soy complex.
The USDA releases its first survey based estimates on the size of the US soybean and corn crops on Wednesday, August 12, and short-covering ahead of the report sent the US grains and oilseeds higher.
Warmer and drier weather conditions in the US Midwest were also said to be somewhat supportive for the grains and oilseeds, according to participants who said canola was largely a follower on the day.
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However, a firmer tone in the Canadian dollar did put some pressure on canola, making it lag soybeans to the upside. The currency was up by nearly three quarters of a cent relative to its US counterpart, which cuts into crush margins and also makes exports less attractive.
About 15,354 canola contracts were traded on Monday, which compares with Friday when 6,401 contracts changed hands.
Milling wheat, durum, and barley were all untraded.
CORN futures on the Chicago Board of Trade rose 16 to 17 cents per bushel Monday on ideas that Wednesday’s USDA report will trim estimates for production and yields. US farmers planted fewer acres this year with heavy spring rains expected to dampen yields, a trader said.
Hedge funds exited bearish bets on corn which served to give prices some support.
Looming dry weather in the Midwest could stress the crop.
SOYBEANS jumped 31 to 35 cents per bushel higher on Monday, as traders bought up futures ahead of Wednesday’s USDA supply and demand report which is expected to cut estimates for soybean sowings this year.
Dry weather in the Midwest is expected to stress soybean plantings that were left vulnerable after heavy spring rains this year.
There is speculation China is preparing to take measures to boost its economy which could increase foreign demand for US supplies.
SOYOIL futures in Chicago ended 36 to 38 points higher.
SOYMEAL futures also took strength from soybeans and demand from livestock operators to finish higher on the day.
WHEAT futures on the Chicago Board of Trade posted gains of 13 to 15 cents per bushel on Monday, supported by spillover gains in beans and corn as well as foreign demand.
Concerns over excess dryness in parts of Europe was also supportive, according to a report.
However, strong competition from grain sellers in the Black Sea region limited the gains.
– Farmers in Norfolk and Suffolk England are taking parts in an experiment to see if they can grow 50 acres of durum in the area. Samples will eventually be sent off for tests to see if it can reach milling standards for pasta.
– Soil moisture conditions on fields near France’s Mediterranean coastline remains abnormally low and close to records set in 1959, according to a report.
Settlement prices are in Canadian dollars per metric tonne.
