By Phil Franz-Warkentin, Commodity News Service Canada
Winnipeg, Jan. 31 (CNS Canada) – ICE Futures Canada canola contracts were down with follow-through speculative selling on Tuesday, hitting their lowest levels in two weeks despite a relatively firmer tone in the Chicago Board of Trade soy complex.
Strength in the Canadian dollar, which was up by roughly half a cent relative to its US counterpart, contributed to the weakness in canola, according to participants.
Early expectations for an increase in Canadian canola production in 2017 also weighed on values.
Read Also
Canadian Financial Close: Loonie continues sliding back
By Glen Hallick Glacier Farm Media | MarketsFarm – The Canadian dollar lost nearly a quarter of a cent on…
However, canola remains attractively priced to end users, with advances in CBOT soyoil helping keep crush margins well supported on the day.
About 21,957 canola contracts were traded on Tuesday, which compares with Monday when 31,667 contracts changed hands. Spreading accounted for 15,026 of the contracts traded.
Milling wheat, durum, and barley were all untraded, although prices were revised after the close.
SOYBEAN futures at the Chicago Board of Trade were mixed on Tuesday, with gains in the front months and losses in the more deferred positions as the market saw some consolidation following Monday’s large losses.
Weakness in the US dollar index and solid weekly export inspections of about 1.6 million tonnes helped underpin the market to some extent.
However, relatively favourable South American crop conditions limited the upside potential, with the nearby chart bias also turning lower.
While excessive moisture remains a concern in parts of Argentina, the weather has turned drier and analysts are starting to raise their production estimates for the country.
SOYOIL futures settled higher on Tuesday, as a rally in crude oil provided support.
SOYMEAL futures were narrowly mixed on Tuesday.
CORN futures in Chicago were up by one to two cents per bushel, seeing a modest correction after Monday’s declines.
Solid export demand contributed to the gains, as recent losses and weakness in the US dollar make US corn more attractive to international buyers.
Advances in crude oil were also supportive for the ethanol-linked corn market, according to participants.
However, just as in beans, the good South American prospects and large US stocks, weighed on values.
WHEAT futures in Chicago were up by two to six cents per bushel on Tuesday, finding some support from the losses in the US dollar as the softer currency should be encouraging additional offshore buying interest.
However, ample world supplies and relatively favourable conditions for the US winter wheat crop limited the upside potential.
