By Phil Franz-Warkentin and Dave Sims, Commodity News Service Canada
September 5, 2014
Winnipeg – ICE Futures Canada canola contracts were stronger on Friday, seeing a speculative short-covering bounce to end the week after hitting fresh contract lows on Thursday.
End user buying was also supportive, amid ideas that demand may need to be rationed going forward, said participants.
Statistics Canada released their latest stocks report Friday morning pegging canola ending stocks, as of July 31, at 2.36 million tonnes, which was at the low end of trade estimates. With production prospects for the current crop still up in the air, given continued harvest delaying wet weather, the likelihood of tighter supplies heading through the year was supportive for prices, said traders.
Read Also
Canadian Financial Close: Loonie returns above 72 U.S. cents
By Glen Hallick Glacier Farm Media | MarketsFarm – The Canadian dollar on Friday finally turned around to close higher,…
Gains in the CBOT soy complex provided some spillover support as well, although the continued expectations for a record large US crop did remain a bearish influence overhanging the oilseeds in general.
About 26,659 canola contracts were traded on Friday, which compares with Thursday when 31,150 contracts changed hands.
Milling wheat, durum, and barley were all untraded.
WHEAT futures in Chicago jumped two to five cents per bushel higher on Friday, on reports of a cease-fire in eastern Ukraine and word that Russia may restrict grain exports.
US wheat supplies stand to gain from such a move, said a trader, who noted current offerings of US wheat are deemed too expensive by most international buyers.
Some traders took profits ahead of the weekend, according to a report.
– Grain in much of the United Kingdom will likely need some drying after wet weather during harvest, analysts said.
– Russia says it has enough capacity for the transportation and storage of this year’s bumper harvest.
– Filipino wheat millers are reportedly weighing whether or not to use US supplies of wheat after a recent tour of the Midwest.
SOYBEAN futures at the Chicago Board of Trade corrected upwards Friday, pushing values anywhere from 16 to 18 cents per bushel higher, just a day after dropping to their lowest level in nearly four years.
Values also drew support from weather concerns and spillover support from corn, said an analyst.
Private forecasters Informa Economics forecast soybean production at 3.876 billion bushels on yields of 46.1 bushels an acre, which would be an all-time record.
SOYOIL futures were higher on Friday, boosted by gains in Malaysian palm oil, said an analyst.
SOYMEAL futures rose higher on Friday following soybeans.
CORN futures in Chicago settled eight to nine cents per bushel higher as values recovered from contract lows earlier in the week.
An expected onset of cool temperatures are causing worries for farmers in Minnesota, northeast Iowa, the Dakotas and other northern growing areas, said traders.
Ethanol production averaged 921,000 barrels for the last week of August. That is up 12.5% from last year.
Informa Economics forecast US corn production at 14.281 billion bushels on yields of 170.3 bushels an acre, also a record high.
Settlement prices are in Canadian dollars per metric ton.
