By Phil Franz-Warkentin and Dave Sims, Commodity News Service Canada
September 2, 2014
Winnipeg – ICE Futures Canada canola contracts were stronger on Tuesday, settling near their highs for the session as early selling pressure proved short-lived.
Advances in CBOT soybeans together with a weaker tone in the Canadian dollar were supportive for canola, according to participants.
A lack of significant farmer selling, as producers turn their attention to harvest operations and other field work, contributed to the gains, said traders.
There is also still enough uncertainty over the size of this
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However, speculative and domestic crusher selling early in the day did temper the gains, with adjustments to the soybean/canola spread said to be behind some weakness in canola. A softer tone in CBOT soyoil also put some pressure on the Canadian market.
About 27,066 canola contracts were traded on Tuesday, which compares with Friday when 20,981 contracts changed hands.
Milling wheat, durum, and barley were all untraded.
SOYBEAN futures at the Chicago Board of Trade were higher Tuesday, as reports of flooding in the Midwest sparked ideas of a delayed harvest, according to a report.
Recent firmness in palm oil and sentiments the market was oversold entering today’s session also helped to support values, said an analyst.
Expectations of record yields in the US limited the gains, traders said.
SOYOIL futures were slightly lower on Tuesday, with spreading against soybeans a feature in the movement, said an analyst.
SOYMEAL futures rose higher on Tuesday following soybeans.
CORN futures in Chicago dipped on expectations Tuesday’s USDA weekly progress report will show slightly improved crop conditions.
Some parts of the Midwest have also begun their harvest which has resulted in some corn entering the market and pressuring values, said an analyst.
The International Grains Council has projected world corn production at 973 million tonnes. That is four million tonnes higher than last month’s forecast which was bearish.
WHEAT futures in Chicago declined on Tuesday, due to large global supplies and beneficial rain in drought-stricken portions of Kansas.
Forecasts for the Southern Plains call for scattered showers which should help fill late summer crops in Nebraska and other nearby states, said an analyst. He noted it would also help replenish soil moisture for next year’s crop as well.
Wheat exports from Ukraine also pressured values as supplies seem to be flowing out of the region smoothly, despite the ongoing conflict with Russia.
Concerns about the potential for frost in Western Canada helped to limit the losses, said participants.
– The International Grains Council has pegged world production of wheat and coarse grains at 1,976 million tonnes. That is 17 million more than last month.
– Algeria is reportedly facing record high import needs. Typically, the country has turned to France for its supplies but wet weather has damaged much of the French crop leaving Algeria searching for a supplier.
– Germany’s 2014 wheat crop will increase by 12 percent to 27.9 million tonnes, according to a report.
Settlement prices are in Canadian dollars per metric ton.
