By Phil Franz-Warkentin and Terryn Shiells, Commodity News Service Canada
April 8, 2015
Winnipeg – ICE Futures Canada canola contracts were weaker on Wednesday, but finished well off their lows for the session.
Light fund selling was a feature, but routine commercial demand and a lack of significant farmer selling helped keep canola near unchanged by the close, according to participants.
Positioning ahead of the USDA’s monthly supply/demand report on Thursday kept some caution in the market. Farmer selling was also said to be on the quiet side, as attention across the Prairies turns to spring field work.
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The Canadian dollar was sharply stronger relative to its US counterpart in early activity, which did put some pressure on canola. However, the currency retreated as the day progressed, which eventually provided some support.
About 12,812 canola contracts were traded on Wednesday, which compares with Tuesday when 14,689 contracts changed hands.
Milling wheat, durum, and barley were all untraded.
CBOT SOYBEAN futures ended mixed after a day of choppy activity on Wednesday, as traders squared positions ahead of the monthly USDA supply and demand report, due out at 11:00 CT on Thursday. Values ended three cents lower, to half a cent per bushel higher.
Pressure from the advancing South American harvest, and reports of good yields for soybeans in the region weighed on values.
Expectations that delayed corn seeding in the US Delta will result in more soybean acres were also bearish.
On the other side, steady demand for the US oilseed and the generally tight domestic old stock supply situation underpinned the market.
SOYOIL futures finished five to eight points lower on Wednesday, taking some direction from a weaker Malaysian palm oil market, traders noted.
SOYMEAL futures were mostly firmer, seeing a slight upward correction following recent declines, brokers said.
CORN futures in Chicago finished three to four cents US per bushel weaker on Wednesday, reacting to forecasts calling for beneficial rain in some of the drier regions in the US Corn Belt.
Weakness in crude oil values was also bearish, given corn’s relationship with the ethanol industry, market watchers added.
Expectations that the USDA’s report on Thursday will show large US inventories of the commodity also weighed on values.
However, ideas that planting delays in the US Delta region will cause farmers to switch some corn acres to soybeans limited the losses.
WHEAT futures at the Chicago Board of Trade closed one cent US per bushel lower, to one cent higher, as traders moved to the sidelines ahead of Thursday’s USDA supply and demand report. Minneapolis and Kansas City wheat futures ended three to five cents softer.
Weakness in corn spilled over to weigh on the wheat markets. Further downward pressure came from forecasts calling for beneficial rain in some US winter wheat growing regions.
On the other side, expectations that Ukraine and Russia will seed fewer acres of wheat this spring were supportive, brokers said.
• It is rumoured that a recent tender for 745,000 metric tons of hard wheat issued by Saudi Arabia was filled by Germany.
• There was talk that Russia’s government would either extend or cancel the wheat export tax as early as April 15. But, the country’s Ag Minister said a decision won’t be made until late May, or early June.
• Soft wheat exports out of France to countries outside the European Union are expected to total 10.6 million tonnes, FranceAgriMer said. Their previous guess called for 10.4 million tonnes of exports.
Settlement prices are in Canadian dollars per metric ton.
