By Phil Franz-Warkentin and Brandon Logan, Commodity News Service Canada
Jan. 30, 2014
Winnipeg – ICE Futures Canada canola contracts settled higher on Thursday, as speculative short covering and spillover from the gains in CBOT soybeans provided support.
Ideas that canola is oversold and cheap compared to most other oilseeds contributed to the correction higher, said traders.
The recent weakness in the Canadian dollar added to the bullish tone, as the currency remained below 90 US cents. The weaker currency makes exports more attractive and was helping keep crush margins at record highs.
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However, continued logistical concerns moving the large Canadian canola crop out of the Prairies limited the advances, as did reports that China could start to cancel US soybean shipments in the near-term, said participants.
The overall technical outlook is still bearish as well, making any modest rallies a good selling opportunity from a chart standpoint.
About 23,114 canola contracts were traded on Thursday, which compares with Wednesday when 20,813 contracts changed hands. Spreading accounted for 15,976 of the contracts traded.
Milling wheat, durum and barley futures were untraded, after seeing some price revisions following Wednesday’s close.
US Grain And Oilseed Review
SOYBEAN futures closed four to five US cents per bushel stronger on Thursday, as short covering following major losses seen in recent sessions was supportive, industry watchers said.
Stronger-than-expected US export sales added to the bullish tone. According to the USDA, 494,800 metric tonnes of soybeans were sold to be exported last week, which beat trade expectations.
Another positive note for soybeans is that China did not cancel any shipments last week, analysts said.
However, expectations that Brazil will produce a record large soybean crop limited any further gains.
SOYOIL futures were three to four points weaker on Thursday, as spreading against soymeal led to some downward pressure, analysts said.
However, spillover from the gains seen in soybeans limited losses.
SOYMEAL futures were US$1.40 to US$1.90 stronger on Thursday, underpinned by strong demand for the US product, brokers said.
CORN futures finished five to six US cents per bushel higher on Thursday, as better-than-expected weekly export sales were bullish for values, participants said.
According to the USDA, 1.84 million metric tonnes of US corn were sold to be exported during the week ended January 23, which surpassed trade expectations of 450,000 to one million tonnes.
Additionally, the USDA also announced that private exports sold 127,000 metric tonnes of corn to unknown destinations on Thursday.
However, favourable forecasts for the development of Argentina’s corn crop limited any further gains.
CBOT WHEAT and KCBT RED WHEAT futures closed one to two US cents per bushel higher on Thursday, as better-than-expected weekly export sales were bullish for values, participants said.
According to the USDA, 1.84 million metric tonnes of US corn were sold to be exported during the week ended January 23, which surpassed trade expectations of 450,000 to one million tonnes.
Additionally, the USDA also announced that private exports sold 127,000 metric tonnes of corn to unknown destinations on Thursday.
However, favourable forecasts for the development of Argentina’s corn crop limited any further gains.
MGEX SPRING WHEAT closed the session one to three US cents per bushel weaker, as large Canadian supplies continued to weigh on prices.
Daily World Wheat News
* Egypt changed their acceptable moisture levels on wheat imports to 13.0% from 13.5%, according to reports. French officials are planning on meeting with Egyptian officials, as the change effectively blocks French wheat exports, analysts said.
* According to Japan’s Ministry of Agriculture, the country purchased 179,343 tonnes of wheat from the US and Australia on Thursday.
* According to reports, Bangladesh bought 150,000 tonnes of wheat from India on Wednesday.
Settlement prices are in Canadian dollars per metric ton.
