By Phil Franz-Warkentin and Terryn Shiells, Commodity News Service
Winnipeg, July 13 – ICE Futures Canada canola contracts were down on Monday, as speculative selling weighed on prices.
After trading just below the C$540 per tonne level in recent weeks, the November contract was looking hard pressed to break above that key resistance level and speculators were said to be booking some profits.
Ideas that rainfall in parts of Western Canada over the weekend helped alleviate some of the drought stress were also bearish, according to participants.
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However, many of the dry areas missed out on the moisture. In addition, forecasts are calling for more heat this week, and the generally declining yield potential remained supportive overall.
A firmer tone in the Chicago soy complex and weakness in the Canadian dollar helped limit the losses as well, as crush margins showed some improvement.
About 12,314 canola contracts were traded on Monday, which compares with Friday when 15,107 contracts changed hands.
Milling wheat, durum, and barley were all untraded.
CBOT SOYBEAN futures were two to six cents US per bushel higher on Monday, finding support from forecasts calling for rainy weather in the US Midwest this week, which could put further stress on already wet crops.
Uncertainty about how many acres of soybeans were seeded this spring, as excess moisture in some parts of the US Midwest kept some farmers out of their fields at planting time, was also supportive.
Steady demand from the domestic livestock sector was also bullish, though the large global oilseed supply situation tempered the upside, analysts said.
SOYOIL futures ended higher, following the strength seen in outside vegetable oil markets, including Malaysian palm oil, brokers said.
SOYMEAL futures were firmer, taking some direction from the soybean market. Strong domestic demand was also bullish.
CORN futures in Chicago finished five to seven cents higher Monday, continuing to react to Friday’s smaller than expected production estimates from the USDA, brokers said.
The USDA said the 2015/16 US corn crop will likely produce 13.53 billion bushels, down from last month’s guess of 13.63 billion.
Concerns about forecasts calling for more wet weather in parts of the US Midwest this week added to the bullish tone, as many crops are already suffering in waterlogged fields.
However, estimates from the USDA’s Brazilian office calling for record large corn production of 82 million metric tonnes in the country tempered the gains.
WHEAT futures at the Chicago Board of Trade closed steady to five cents US per bushel lower on Monday, as global wheat supplies are still projected at near record levels, despite weather problems in North America and Europe this year.
Reports that US wheat is still too expensive to attract fresh export demand further undermined prices, traders said.
However, some spillover support came from the advances seen in corn and soybeans.
• Brazil’s wheat crop is expected to produce 6.5 million metric tonnes, the USDA’s ag attaché in Brazil, said. That’s above the 6.0 million currently forecasted by the USDA.
• Farmers in Scotland are growing more wheat this year, with acres increasing by about 7,150 acres, figures from AHDB Cereals and Oilseeds show.
• Data shows that the State-run Food Corporation of India (FCI) has procured 27.6 million tonnes of wheat so far this marketing year, down slightly from 28.0 million at the same time last year.
Settlement prices are in Canadian dollars per metric ton.
