By Phil Franz-Warkentin and Jade Markus, Commodity News Service Canada
Winnipeg, Jan. 12 (CNS Canada) – ICE Futures Canada canola contracts were stronger on Thursday, as a rally in Chicago Board of Trade soybeans provided spillover support.
Soybeans climbed sharply following the release of the US Department of Agriculture’s latest supply/demand report. The data included an unexpected downward revision to the 2016 US soybean crop, which sparked the rally, according to participants.
Solid end user demand contributed to the gains in canola, as crush margins remain at wide levels. A lack of farmer selling was also noted, as severe winter weather conditions across much of the Prairies limited country movement.
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Strength in the Canadian dollar kept canola lagging soybeans to the upside.
About 20,882 canola contracts were traded on Thursday, which compares with Wednesday when 14,596 contracts changed hands. Spreading accounted for 9,772 of the contracts traded.
Milling wheat, durum, and barley were all untraded, although prices were revised after the close.
SOYBEAN futures at the Chicago Board of Trade closed about 14 to 29 cents per bushel stronger on Thursday, following the release of World Agriculture Supply and Demand Estimates (WASDE) from the United States Department of Agriculture (USDA).
The USDA pegged US oilseed production for 2016/17 at 127.3 million tonnes, down 1.5 million from the last report, released in November, which is bullish.
Soybean production is estimated at a record 4,307 million bushels, down 54 million from last month on lower yields, the USDA said.
The USDA left its long-term export estimates unchanged, but weekly export sales were down on the week, and below analyst expectations, which limited the upside.
Sales reported in the week ending January 5 totalled 348,900 metric tonnes for 2016/2017.
SOYOIL prices closed higher on Thursday. Advances in the soybean market were tempered by overnight losses in Malaysian palm oil.
SOYMEAL closed higher on Thursday.
CORN futures were unchanged to one cent per bushel higher, but mostly unchanged on Thursday.
The USDA expects corn production will reach a record 15,148 million bushels, which is down 78 million bushels from previous estimates. That figure kept support in the market, but production remains up about 11 per cent from the previous year, which capped advances.
WHEAT closed six to seven cents per bushel higher on Thursday, as the trade focused on winter wheat acreage numbers.
Winter wheat seeding numbers dropped to a 108-year-low, falling 3.8 million acres, which is bullish.
However, the expectation for higher ending stocks of the grain (the highest level since the late 1980s) limited advances.
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