By Phil Franz-Warkentin and Dave Sims, Commodity News Service Canada
Winnipeg, May 30 (CNS Canada) – ICE Futures Canada canola contracts were down sharply on Tuesday, hitting their lowest levels in more than a month.
Speculators liquidating long positions accounted for much of the selling pressure, with losses in the Chicago Board of trade soy complex contributing to the softer tone in canola.
Some stops were hit on the way down, which exaggerated the declines in the front month, according to participants.
Farmer hedges were said to be another feature, as seeding wraps up in parts of Western Canada and producers look to sell some old crop canola.
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Scale-down end user demand provided underlying support, but buyers were not very aggressive as the nearby trends point to additional weakness, said traders.
Concerns over tight old crop supplies and persistent weather issues for the new crop in some parts of the Prairies underpinned the futures.
About 26,313 canola contracts traded on Tuesday, which compares with Monday when 4,178 contracts changed hands. The narrowing of the July/November spread was a feature, with spreading accounted for 11,694 of the contracts traded.
Milling wheat, durum, and barley were all untraded.
SOYBEAN futures at the Chicago Board of Trade finished seven to 13 cents weaker to kick off the holiday-shortened week. The market was pressured by large supplies coming in from South America.
There are ideas more farmers in the US have begun to switch acres from corn to soybeans, due to the prospects of a shorter season.
US Soybean export inspections were in the middle of analysts’ expectations.
SOYOIL futures dropped 17 to 18 points on Tuesday.
SOYMEAL futures finished lower on Tuesday.
CORN futures in Chicago ended six to seven cents per bushel lower on Tuesday due to the rapidly progressing US harvest.
The market also suffered spillover losses from soybeans.
However, export inspections in the US were pegged at 1.195 million tonnes, which was toward the upper end of expectations.
WHEAT futures in Chicago fell seven to eight cents per bushel on Tuesday. The market was pressured as Argentina’s agricultural wing pegged its crop at 20 million tonnes, three million tonnes more than the USDA’s estimate.
According to Russia’s agricultural ministry, the country exported 25.2 million tonnes of wheat from July 1, 2016 to May 24, 2017. That is 1.3 per cent more than last year.
There continues to be concerns over the quality of hard red winter wheat in the US, which helped limit the losses.
