By Dave Sims and Phil Franz-Warkentin, Commodity News Service Canada
Winnipeg, May 20 – The ICE Futures Canada canola market finished weaker on Wednesday, as losses in CBOT soybeans and soymeal weighed down canola prices.
European rapeseed futures were also weaker which contributed to the declines.
Large global supplies of oilseeds contributed to the bearish tone, said a trader.
A stronger tone in the Canadian dollar also weighed on values as it made canola less attractive to out-of-country buyers.
Malaysian palm oil and US soyoil were firmer which helped limit the losses.
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Cold temperatures across Western Canada over the weekend also have raised the question of whether any early-seeded canola was damaged, said a trader.
“Because we had some real cold temps here in Manitoba and Saskatchewan at -5 (Celsius) and -7 (Celsius),” he said.
Farmer selling was slow as producers focused on seeding and
field-work.
Around 23,069 canola contracts were traded on Wednesday, which compares with Tuesday when around 19,001 contracts changed hands. Spreading accounted for 11,226 of the contracts traded.
Milling wheat, barley and durum were all untraded.
Settlement prices are in Canadian dollars per metric ton.
SOYBEAN futures at the Chicago Board of Trade were down by three to six cents per bushel on Wednesday, hitting fresh lows in the process as chart-based selling and the good US weather conditions weighed on values.
After dropping below nearby support levels on Tuesday the nearby technicals have turned bearish for soybeans, which contributed to the declines.
The large South American crop also weighed on prices.
However, oversold price sentiment and a lack of farmer selling did help temper the declines.
SOYOIL settled steady to slightly higher on Wednesday, with spillover from the gains in the outside crude oil market and spreading against soymeal providing some underlying support.
SOYMEAL futures settled lower on Wednesday.
CORN futures in Chicago settled two to four cents per bushel lower on Wednesday, as the good Midwestern weather conditions continued to weigh on values.
The US corn crop was 85% seeded as of this past Sunday, and the forecasts are generally calling for favourable weather to finish seeding over the next week.
A slightly firmer tone in wheat did provide some spillover support for corn, helping limit the losses.
WHEAT futures in Chicago were narrowly mixed on Wednesday, finishing with two or three cents of either side of unchanged. The most active front months were all steady to higher on the day, with weather concerns in parts of the US Plains providing support. Minneapolis and Kansas City futures were all higher on the day, posting gains of two to five cents.
Excessive moisture in parts of the southern Plains could be hampering yields and quality at harvest time, while cold temperatures in other wheat growing regions of the US are also keeping some caution in the futures.
However, large global supplies and a continued lack of significant export demand for US wheat did remain bearish overall.
– China will grow a record large grain crop this year, with good rainfall in the Henan and Shandong provinces helping boost production, according to UkrAgro Consult.
– Wheat area in Argentina could be down by 10% to as much as 25% due to rising input costs and poor returns, according to analysts in the South American country.
