By Terryn Shiells, Commodity News Service Canada
Winnipeg, April 1 – ICE Futures Canada canola contracts were stronger on Tuesday, as the fund buying seen in Chicago soybean and soyoil futures spilled over to lift values, analysts said.
Ongoing worries about tight US soybean supplies and spillover support from the advances seen in European rapeseed futures added to the bullish tone.
Continued ideas that canola is undervalued compared to other oilseeds also underpinned the market, as did steady commercial demand.
However, the upswing in the value of the Canadian dollar, farmer selling at the highs and ongoing logistics problems across the Prairies were bearish.
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About 29,251 canola contracts were traded on Tuesday, which compares with Monday when 13,517 contracts changed hands. Spreading accounted for 24,824 of the trades.
Milling wheat, durum and barley futures were untraded, though the Exchange adjusted wheat values after the close.
SOYBEAN futures at the Chicago Board of Trade closed sharply higher on Tuesday, lifted by fund buying, market watchers said. The market finished anywhere from 15 cents to 28 cents US per bushel higher.
Ongoing worries about tight US supplies and expectations that carryout stocks in the US for 2013/14 will be lower than the current USDA forecast of 145 million bushels were also bullish.
However, expectations that US soybean acreage will increase this spring and pressure from the advancing South American soybean harvest limited the advances.
SOYOIL futures were sharply higher, as fund buying and short covering following recent losses helped to support the market, brokers said.
SOYMEAL futures finished firmer, following the gains seen in soybeans, traders said.
CORN futures in Chicago settled five to eight cents a bushel higher on Tuesday, following the advances seen in soybeans, analysts said.
Monday’s USDA report, which showed lower than expected acreage estimates, further underpinned prices. According to the USDA, US farmers will plant 91.7 million acres of corn this spring, down four per cent from last spring.
Continued strong demand for US corn supplies and worries about cold, wet weather delaying field work and planting in the US added to the bullish tone.
However, profit taking and a pickup in farmer selling at the highs tempered the gains.
WHEAT futures in the US were softer, with most Kansas City, Minneapolis and Chicago futures ending one to 12 cents US a bushel lower on Tuesday. Monday’s USDA report continued to be bearish for US wheat futures.
The USDA said stocks of US wheat totalled 1.06 billion bushels as of March 1, 2014, which was higher than expectations of 1.03 billion bushels.
Forecasts calling for beneficial rainfall in parts of the US Plains where winter wheat is grown this week also undermined the futures.
However, uncertainty surrounding how much damage has been done to US winter wheat crops by recent dry conditions tempered the declines.
• Agriculture officials reported that cold weather in India could cause the wheat harvest in Punjab and Haryana to be delayed by two to three weeks. The harvest in those areas generally begins in late March, early April.
• India set a goal to procure 3.5 million metric tonnes of wheat from farmers this year, Punjab Chief Minister Shahbaz Sharif said on Monday.
• Reports say a strain of damaging stem rust disease has infected more than 10,000 hectares of wheat in southern Ethiopia, which has farmers in the surrounding regions on alert.
