By Terryn Shiells and Dave Sims, Commodity News Service Canada
Winnipeg, July 8 – Canola contracts on the ICE Futures Canada trading platform ended lower after a day of very volatile activity on Wednesday.
Reports of improving crop conditions in Canadian canola fields, due to recent favourable rainfall, were bearish, as was some speculative based selling, analysts said.
Spillover pressure came from the declines seen in Malaysian palm oil and European rapeseed futures as well.
The weakness was also linked to traders shedding riskier assets, such as commodities, amid worries about economic problems in Greece and China, brokers added.
Read Also
North American grain/oilseed review: Canola falls Friday
ICE Futures canola market was weaker on Friday, settling at its weakest levels in two weeks. Speculative selling was a…
However, ongoing concerns about lower North American oilseed production this year, as the US Midwest is too wet, and Western Canada remains hot and on the dry side, underpinned values, as did strength in the Chicago soy complex.
Softness in the Canadian dollar was also supportive, as it made canola more attractive to foreign buyers.
About 15,616 contracts traded on Wednesday, which compares with Tuesday when 18,729 contracts changed hands. Spreading accounted for 2,622 of the trades.
Milling wheat, barley and durum futures were untraded. Though, the Exchange adjusted wheat prices following Wednesday’s close.
Heavy rainfall across much of the US Midwest prevented farmers from seeding fields with soybeans earlier this spring, and at this point many aren’t going to bother anymore. More rain is forecast to fall this week.
On Friday, the USDA will release its monthly World Agricultural and Supply Demand Estimates report. Analysts expect it will reduce the outlook for domestic soybean production by 1.5%, compared to last month’s estimate.
Soyoil futures in Chicago were 17 to 25 points higher watching soybeans.
Soymeal futures also posted mild gains on the day.
Corn futures on the Chicago Board of Trade ticked slightly higher Wednesday, supported by ideas that the excess moisture felt in the US Midwest this spring is starting to cut into quality.
Weakness in the US dollar also supported values.
Ethanol production is also rising due to increased demand. A report says production rose 19,000 barrels in the US to 987,000 barrels a day.
Wheat futures on the Chicago Board of Trade continued to drift lower Wednesday, falling seven to eight cents per bushel as US farmers made harvesting progress which added supplies to the market.
A heat wave that has gripped France and other wheat-growing countries in Europe is starting to fade, according to a report.
The weaker US dollar also helped exporters move supplies to international buyers.
– Production of French soft wheat this year will hit its second highest level in recent history, lifted by elevated sowings, the French farm ministry said.
– Algeria’s cereal imports (wheat, corn and barley) totalled US$1.65 billion in the first five months of 2015. That compares to US$1.45 in the same period in 2014, marking a 14.04% rise, according to a report.
– India will roll out its multi-billion dollar food welfare plan by December, the food minister said, allowing 67 per cent of its 1.2 billion people access to inexpensive rice and wheat.
Settlement prices are in Canadian dollars per metric ton.
