By Phil Franz-Warkentin and Terryn Shiells, Commodity News Service
Winnipeg, July 15 – ICE Futures Canada canola contracts settled with small losses on Wednesday as speculative long-liquidation weighed on values. However, the market finished well off its lows for the day, as sharp weakness in the Canadian dollar and ongoing weather worries provided support.
The most active November contract had been down by nearly ten dollars per tonne at one point during the session, but was only down C$1.10 per tonne by the close.
Spillover from the softer tone in CBOT soyoil, together with talk of improving crop prospects in parts of Western Canada did weigh on prices to some extent, according to participants.
Read Also
Canadian Financial Close: C$ weaker Thursday
Glacier FarmMedia — The Canadian dollar was weaker on Thursday, as its United States counterpart regained lost ground in international…
However, there are still more than enough areas of concern to keep some weather premiums in the market, with canola production generally expected to be down considerably on the year.
A sharply weaker tone in the Canadian dollar, which lost over one cent relative to its US counterpart, also helped provide some underlying support for canola. The softer currency makes exports more attractive and is also beneficial for domestic crush margins.
About 20,202 canola contracts were traded on Wednesday, which compares with Tuesday when 14,614 contracts changed hands. Spreading accounted for 4,000 of the contracts traded.
Milling wheat, durum, and barley were all untraded.
CBOT SOYBEAN Futures were six to nine cents US per bushel lower on Wednesday, with signs of improving weather conditions in the US Midwest behind the losses. The return to drier weather may help some farmers seed more acres to soybeans than initially anticipated, according to analysts.
Strength in the US dollar index and expectations of stiff competition on the export market from South America added to the bearish tone.
However, some support came from positive US crush data. The National Oilseed Processors Association said 142.5 million bushels of soybeans were crushed last month, which is down from 148.4 million in May but above pre-report expectations calling for 141.1 million bushels.
CORN futures in Chicago finished steady to two cents higher, as the market consolidated following Tuesday’s sell-off, brokers said.
Signs of continued good demand from the domestic ethanol sector, as production is still near record highs, provided some support.
However, weather conditions are reportedly favourable for pollination in parts of the US Midwest, which was bearish.
WHEAT futures at the Chicago Board of Trade closed mixed on Wednesday, finishing anywhere from four cents lower, to four cents higher. The nearby contracts moved lower, while more deferred positions posted small gains.
Prices were undermined by a lack of fresh export demand amid reports that US wheat is still too expensive on the international market. The strong US dollar also weighed on values.
On the other side, sentiment that recent losses were overdone was supportive, as were ongoing worries about harvest delays and quality problems for the US winter wheat crop.
• Egypt bought 235,000 tons of wheat on Tuesday, which means they should have enough supplies to last until mid-February, reports say.
• As of July 13, 2015, the Food Corporation of India (FCI) had procured 28.08 million tonnes of wheat, above last year’s level of 28.00 million tonnes. The FCI hopes to procure 30 million tonnes of wheat this season, which ends in March.
• Pakistan’s government is reportedly planning to export between 500,000 and 600,000 metric tons of wheat to Madagascar, Sudan and Yemen in an effort to rid the country of surplus supplies.
Settlement prices are in Canadian dollars per metric tonne.
