By Terryn Shiells and Phil Franz-Warkentin, Commodity News Service Canada
Winnipeg, April 4 – ICE Futures Canada canola contracts closed weaker on Friday, undermined by profit taking ahead of the weekend.
Spillover pressure from outside commodity markets, including Chicago soyoil and wheat futures, was also bearish, brokers said.
A recent pickup in farmer selling, the large Canadian supply situation, the stronger Canadian currency and expectations that Canadian canola acreage will increase this spring added to the bearish tone.
However, continued ideas that canola is undervalued compared to other oilseeds limited the losses, as did steady commercial demand.
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Optimism that logistics problems in Western Canada are improving kept a firm floor under the market.
About 16,048 canola contracts were traded on Friday, which compares with Thursday when 14,517 contracts changed hands. Spreading accounted for almost all of the trade activity.
Milling wheat, durum and barley futures were untraded, though the Exchange adjusted wheat prices after the market closed on Friday.
SOYBEAN futures at the Chicago Board of Trade were mixed on Friday, losing one-and-a-half cents in the nearby May contract while posting gains of up to five cents in the more deferred months. Most of the activity was linked to speculative positioning ahead of the weekend.
Tightening old crop US soybean supplies remained a supportive factor in the market.
On the other side, ideas that planting delays in the Midwest could cause more area to shift out of corn and into soybeans did weigh somewhat on values.
SOYOIL futures were mixed on Friday, with losses in the front months and a firmer tone in the more deferred positions.
SOYMEAL futures were narrowly mixed on Friday.
CORN futures in Chicago were one to five cents per bushel higher on Friday, recovering from the losses seen most of the day by the close.
Recent Chinese cancellations of previous US corn purchases did put some pressure on prices, according to participants.
However, the heavy rain and snow seen across parts of the Midwest this week did provide some underlying support as the excessive moisture will likely push back spring seeding.
Chart-based buying was also supportive, as the nearby May contract hovered around the US$5.00 per bushel level.
WHEAT futures in Chicago settled one to six cents per bushel lower on Friday, as improving moisture conditions in parts of the Southern Plains weighed on prices.
Some much needed moisture was in the forecasts for the eastern portions of the dry Southern Plains. However, more precipitation is still needed, as most of Kansas remains in a drought situation and the precipitation was expected to miss the driest areas.
Ideas that end users were largely covered for the next few months also put some pressure on wheat values, according to traders.
• The European Union granted export licences for 596,000 tonnes of soft wheat during the past week, according to official data. The exports to date in the 2013/14 marketing year, which ends June 30, have already topped the previous record for an entire year with 23.3 million tonnes sold to date.
• A report from Informa Economics pegs the 2014/15 US winter wheat crop at 1.616 billion bushels.
• The USDA releases its first crop progress report of the season on Monday, April 7.
ICE Futures Canada settlement prices are in Canadian dollars per metric ton.
