By Terryn Shiells and Dave Sims, Commodity News Service Canada
WINNIPEG – ICE Futures Canada canola contracts ended sharply higher, lifted by the strong gains seen in Chicago soyoil futures on Friday.
Sentiment that Thursday’s move to fresh four-month lows was overdone added to the bullish tone, as did slow farmer selling in Western Canada.
Concerns that more Canadian canola acres will go unseeded than normal this spring, due to ongoing wet conditions in parts of Manitoba and Saskatchewan, further underpinned prices.
However, the crops that have been seeded are thought to be in generally good condition, which limited the upside.
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The large Canadian canola supply situation continued to overhang the market as well.
About 17,627 canola contracts were traded on Friday, which compares with Thursday when 18,503 contracts changed hands.
Durum and barley futures were untraded and unchanged. Milling wheat futures were also unchanged, though slight price revisions were made following Friday’s close.
SOYBEAN futures at the Chicago Board of Trade rose eight to 10 cents per bushel on a correction Friday, as technical buyers and other traders looked to take advantage of low prices.
Although three-quarters of the US crop was rated in good or excellent conditions this week, any significant weather issues could change that analysis very quickly, an analyst said.
On Friday, soybean acreage in the US was pegged at 81.8 million acres by Informa Economics, which was down slightly from their last estimate.
SOYOIL futures were sharply higher on Friday.
SOYMEAL futures were lower, with spreading against soymeal a feature.
CORN futures in Chicago corrected three cents per bushel higher Friday, as traders bought supplies on speculation the prices, which sunk to their lowest point in four months this week, likely won’t last. Some analysts say they worry the favourable weather that has improved crop conditions this year may not continue for much longer.
The low price of corn may also be attracting users of livestock feed and investors looking for value.
Ethanol blender margins should show improvement with the rise in crude oil due to tensions in Iraq.
WHEAT futures in Chicago were generally three to five cents per bushel lower Friday, with the exception of the July contract which was half-a-cent per bushel higher on speculation that production of hard-red winter varieties in the US Southern Plains will be reduced because of excessive rain. Rising global wheat production undermined the more deferred values, according to analysts.
There are growing concerns fungal disease could begin to sprout in southern growing areas, due to the moisture. That rain is also keeping farmers out of their fields.
The US dollar is holding the upper side of the range right now which could limit follow-through buying, according to a report.
• Wheat farmers from Europe and Russia are the most aggressive sellers on the world market, as production and export ideas are already high for the regions, reports said.
• Ukraine is expected to start exporting more wheat now as the harvest is proceeding well and the political situation is less tense, industry officials say.
• The UK has imported more wheat than it exported for the 23rd consecutive month in May, recent reports show. Imports of wheat into the UK were at 113,861 tonnes in May, which compares with the 26,910 tonnes that were exported.
ICE Futures Canada settlement prices are in Canadian dollars per metric ton.
