By Phil Franz-Warkentin and Dave Sims, Commodity News Service Canada
March 24, 2014
Winnipeg – ICE Futures Canada canola contracts were stronger on Monday, seeing a corrective bounce to start the week amid ideas that recent losses were overdone.
Spillover from the gains in CBOT soybeans and a lack of significant farmer selling were also supportive for canola, according to traders.
Steady commercial demand helped underpin the futures as well, although the ongoing logistics issues across Western Canada did continue to overhang the market, said participants.
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While canola was due for a corrective bounce, traders cautioned that the nearby technical bias has turned lower once again; which tempered the upside. Losses in CBOT soyoil and Malaysian palm oil, together with the firmer tone in the Canadian dollar, were also bearish for canola.
About 18,127 canola contracts were traded on Monday, which compares with Friday when 27,263 contracts changed hands. Spreading accounted for 9,312 of the contracts traded.
Milling wheat, durum and barley futures were untraded, after seeing some price revisions following Friday’s close.
SOYBEAN futures at the Chicago Board of Trade rose five to 17 cents per bushel on Monday, as cold weather reports in the Midwest cast doubt over timelines for spring fieldwork and possibly planting.
The soybean trade is gearing up for the USDA’s March 31 estimate of US March 1 grain stocks and US 2014 planted acres by crop, according to participants.
May futures rebounded after holding support at the trend-line off January and March lows, triggering bargain hunting, said an analyst.
SOYOIL futures were mostly lower Monday with the most active contracts down 12 to 17 points Monday, following the downturn in Malaysian palm oil which put continued pressure on values.
SOYMEAL futures was up three to six dollars higher on Monday following soybeans. Spreading against soyoil contributed to the gains.
CORN futures in Chicago were up seven to 11 cents per bushel on Monday as a lack of railcars continued to prevent ethanol from reaching refiners.
A bitterly cold winter and rising crude-oil shipments have caused railroad traffic to back up in the Midwest, where most U.S. ethanol is made using corn grown in the region.
WHEAT futures in the US rose 17 to 21 cents per bushel on Monday, as forecasted dry weather in the U.S. Southern Plains and a threat of trade disruptions with Russia, caused concerns about supply.
Private forecaster DTN says weather in the southern plains will be dry in the next seven days.
Farmers in Ukraine, on pace to be the sixth-largest shipper, have cut grain sales to “very minimum” levels amid currency declines, said a research company in Kiev.
– Ontario grain farmers warned grain prices could drop as U.S. farmers plant more acres.
– The eastern two-thirds of the U.S., will feel a blast of Arctic air this week with temperatures falling 10 to 20 degrees below normal, said a report from the National Weather Service.
– The chairman of eastern Australia’s biggest grain handlers says urgent spending is needed on the country’s railways. Don Taylor worries growers could become uncompetitive in the market and miss out on the Asian food boom.
Settlement prices are in Canadian dollars per metric ton.
