By Dave Sims and Phil Franz-Warkentin, Commodity News Service Canada
Winnipeg, April 29 – The ICE Futures Canada canola market ended mostly lower Wednesday, due to speculative, chart-based selling.
The most-frequently traded July contract broke below C$448 per tonne, which had been a key support level over the past few days, according to a trader.
Recent advances in the Canadian dollar weighed down prices in the early going.
Weakness in Malaysian palm oil and huge world supplies of vegetable oil also put pressure on prices, analysts said.
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However gains in the US soy complex helped to limit the losses.
Slow farmer selling lent support to values along with a weather premium in the market. Rain is needed on roughly 40 percent of the Prairies for canola growers to comfortably begin seeding, according to the trader.
“There are no spots on the Prairies that I know that are too wet to go,” he said.
About 17,458 contracts traded on Wednesday, which compares with Tuesday when 14,577 contracts changed hands.
Milling wheat, durum and barley futures were all untraded and unchanged.
SOYBEAN futures at the Chicago Board of Trade were up by eight to 11 cents per bushel on Wednesday, as solid end user demand, a labour dispute in Argentina, and ideas that US acres may not live up to earlier expectations all supported prices.
Exports were halted from the Rosario port in Argentina due to a strike by river boat captains at the major soybean export hub keeping cargo vessels from docking.
Ideas that the good seeding weather across the US Midwest would see fewer corn acres diverted to soybeans than anticipated contributed to the gain.
Speculative short covering was another feature, as soybeans rose to their highest levels in a month.
SOYOIL settled higher on Wednesday, following soybeans.
SOYMEAL futures were stronger on Wednesday.
CORN futures in Chicago settled two to four cents higher on Wednesday, finding some spillover support from the advances in soybeans.
End-user bargain hunting and speculative short covering, after prices hit six-month lows earlier in the week, contributed to the turn higher in corn, according to participants.
However, the near ideal planting conditions across the US Midwest limited the upside potential in corn.
WHEAT futures in Chicago were up by five to nine cents per bushel on Wednesday, as the market continued to see a corrective bounce off of the five-year lows hit earlier in the week. Minneapolis and Kansas City wheat futures were also up on the day.
Fund traders are reported to be holding record large short positions in wheat, leaving the market open to some short covering from investors.
A weaker tone in the US dollar index was also supportive for wheat, as it should make US supplies more competitive in the global market.
However, large international supplies and improving crop conditions in many wheat growing regions of the world did limit the advances.
– The Czech Republic is forecast to see an increase in wheat production in 2015/16, due to increased acres and good winter weather conditions, according to a report from the USDA.
– Wheat production in India’s Punjab region is expected to be down by 10% to 30% compared to earlier estimates due to an adverse growing season that saw heavy rains and hailstorms.
– Russia is expected to ease its restrictions on wheat exports, due to improving crop prospects in the country.
