By Phil Franz-Warkentin and Jade Markus, Commodity News Service
Winnipeg, August 26 – ICE Futures Canada canola contracts were down at Wednesday’s close, as losses in the CBOT soy complex, bearish chart signals, and the looming Prairie harvest all weighed on values.
The nearby technical bias is pointing lower for canola, and speculative selling pressure contributed to the losses as fund traders built on their recently established net short position.
While farmers were not thought to be active sellers, the looming Canadian harvest was still a bearish influence as well, according to an analyst who said end users seem content to back away and wait for the inevitable rush of fall deliveries.
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About 26,797 canola contracts were traded on Wednesday, which compares with Tuesday when 32,721 contracts changed hands. Spreading accounted for 16,920 of the contracts traded.
Barley futures were lower, with fifty contracts traded in light commercial activity. Milling wheat and durum were both untraded.
SOYBEAN futures at the Chicago Board of Trade closed 11 to 16 cents per bushel lower Wednesday as strength in the greenback spurred concerns about demand for US commodities.
A stronger US dollar weighed on soybeans particularly, as it makes the beans less affordable for buyers.
Analysts say concerns about China’s economy also pressured prices, as the country is a major importer of oilseeds.
On Monday Chinese stocks plummeted, and on Tuesday the country’s bank introduced an interest rate cut, but market watchers say that move didn’t do much to ease trader’s concerns.
Lower crude oil prices added to the bearish tone. Weaker prices discourage refineries from blending biodiesel, in which soybeans are a major component.
SOYOIL prices settled weaker on Wednesday following soybean futures.
SOYMEAL closed lower Wednesday following neighbouring markets.
CORN futures closed one to three cents per bushel weaker Wednesday, pressured by a stronger US dollar, and as analysts say weather in the US Midwest is lending a hand to growth.
Weather in the Midwest is speeding crop maturity ahead of harvest, analysts say.
WHEAT futures in Chicago closed three to five cents per bushel lower Wednesday, with no fresh news besides a stronger greenback, the bearish factors wheat has been struggling with lately remained.
Market watchers say wheat has little to no bullish factors, as high global supplies and a lack of demand pressured prices.
Global sellers are pushing prices lower, trying to find demand for the commodity, traders say.
– All three wheat contracts are technically oversold, analysts say, attributing it to a strong US dollar and ample world supplies.
– Cash markets are comparing themselves to the December contract, traders say.
