By Terryn Shiells, Commodity News Service Canada
Winnipeg, Feb. 21 – ICE Futures Canada canola contracts were stronger on Friday, following the advances seen in Chicago soyoil futures, analysts said.
Spillover support also came from the gains seen in Chicago soybean futures.
The sharp downswing in the value of the Canadian dollar added to the bullish tone, as did continued ideas that canola is undervalued compared to other oilseeds.
Some continued short covering following last week’s sharp declines also underpinned prices.
However, continued slow usage of Canadian canola supplies, due to logistics problems within Western Canada, helped to limit the gains.
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A bearish technical bias and increased farmer selling into the cash pipeline also weighed on canola futures.
About 33,942 canola contracts were traded on Friday, which compares with Thursday when 26,443 contracts changed hands. Spreading accounted for 31,774 of the trades.
Milling wheat, durum and barley futures were untraded and unchanged.
SOYBEAN futures closed eight to 18 cents higher on Friday, lifted by chart-based and follow-through buying on Thursday’s gains.
No signs of Chinese cancellations of US soybeans in the USDA’s weekly export sales report were also supportive, as were continued worries about the tight US supply situation.
However, signs that demand for US soybeans is starting to slow down and expectations of a large South American crop limited the gains.
SOYOIL futures were 34 to 41 points higher, lifted by chart-based buying and strong demand, analysts said.
SOYMEAL futures closed US$3.20 to US$4.90 higher taking some direction from the gains seen in soybeans, brokers noted.
CORN futures were two to five cents lower Friday, undermined by technical based selling and profit taking ahead of the expiry of March options, said analysts.
A USDA report, which predicted a 4.1 per cent jump in yields compared to last year for the 2014/15 crop was also bearish. Predictions that 2014/15 ending stocks of US corn would jump to 2.111 billion bushels also weighed on prices.
However, continued strong export demand and expectations of lower planted acreage for US corn in 2014/15 limited the declines.
WHEAT futures in the US were lower, as Minneapolis, Kansas City and Chicago futures finished six to 18 cents US per bushel lower.
Profit taking following recent gains and ahead of the weekend was responsible for some of the price softness.
Weekly USDA export sales data, which was at the low end of expectations, was also bearish, as was the large global supply situation.
However, continued worries about cold and dry weather harming some US winter wheat crops limited the declines, market watchers said.
• India is hoping to import 31 million tonnes of wheat in 2014/15 which would be an increase of 22 per cent compared to 2013/14, the country’s government said.
• Wheat conditions in Texas declined during the week ended February 16, with 44 per cent rated as poor to very poor, from 41 per cent the week prior. Only 17 per cent of the crop was in good to excellent condition, the Texas office of the National Agricultural Statistics Service said.
• Argentina exported 427,032 tonnes of wheat as of February 20, reaching 85 per cent of the government’s quota, according to officials. Most of the wheat was shipped to Brazil.
