By Phil Franz-Warkentin and Dave Sims, Commodity News Service Canada
September 29, 2014
Winnipeg – ICE Futures Canada canola contracts were up on Monday, as gains in CBOT soybeans and soyoil provided some spillover support.
Speculative short-covering was a feature, although canola did run into resistance to the upside with the November contract unable to make a move above the psychological US$400 per tonne level.
Rainfall in parts of Western Canada over the weekend, and the resulting harvest delays, provided some additional support for canola on Monday, said traders.
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However, activity was described as thin and choppy, with positioning ahead of Tuesday’s USDA stocks report and Friday’s Statistics Canada production report keeping some caution in the market.
About 9,635 canola contracts were traded on Monday, which compares with Friday when 39,112 contracts changed hands. Spreading was a feature, accounting for 8,094 of the contracts traded.
Milling wheat and durum were both untraded, but barley saw some activity late in the day and moved up in the October contract. The action in barley was likely tied to participants cleaning up the small open interest in the front month before deliveries.
CORN futures in Chicago ended two cents per bushel higher Monday, as traders positioned themselves ahead of tomorrow’s USDA grain stocks and small grains summary report.
Trade guesses for tomorrow’s USDA report peg September 1st corn stocks near 1.185 billion bushels, up 821 million over last year.
Weather forecasts for the Midwest suggest a bit of rain will fall this week, but likely not enough to seriously disrupt the fall harvest. Taiwan’s recent corn-purchase from Brazil was also seen as being bearish for values.
SOYBEAN futures at the Chicago Board of Trade corrected off nearby lows Monday, rising 12 to 13 cents per bushel on sentiments that values were oversold.
Trade guesses for tomorrow’s September 1st stocks report hover around 126 million bushels. That compares to 141 million last year.
Exports are expected to pick up as the soybean harvest progresses along, according to an analyst.
SOYOIL futures ended higher on Monday, following palm oil, said an analyst.
SOYMEAL futures recorded slight gains, following soybeans.
WHEAT futures in Chicago lifted four to seven cents per bushel higher on Monday, as traders squared positions ahead of tomorrow’s USDA report.
Values were also reacting to news that Taiwan bought 80,000 tonnes of wheat from the US over the weekend.
– Kazakhstan plans to export seven million tonnes of wheat to countries in southeast Asia, according to a report.
– World wheat acreage is expected to hit a 17-year high, due to increased plantings in the US, Ukraine and Turkey.
– India is studying a new fungicide from a German company that is designed to control loose smut disease. Experts say the problem robs many crops in Northern India of both yield and quality.
Settlement prices are in Canadian dollars per metric ton.
