By Dave Sims, Commodity News Service Canada
WINNIPEG, Apr. 10 (CNS) – The ICE Futures Canada canola market finished lower on the day, weighed down by strength in the Canadian dollar.
Thoughts the market was overbought also dragged down prices.
In its latest supply and demand report that was released today, the USDA forecast a record soybean crop in Brazil of 115 million tonnes. The agency also pegged soybean exports in the U.S. at 2.065 billion bushels, which was very similar to the previous forecast.
The USDA said 120,000 tonnes of U.S. soybeans were sold to Argentina. That is a rare move as Argentina usually is one of the world’s largest rivals to the U.S. when it comes to soybeans. The move only underscores how serious this year’s drought has been in the South American country. The USDA pegged Argentina’s soybean crop at 40 million tonnes, which compares to last month’s estimate of 46.5 million.
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On the other side, gains in U.S. soybeans and soyoil were supportive for values.
Around 25,548 canola contracts were traded on Tuesday, which compares with Monday when around 32,210 contracts changed hands. Spreading accounted for 19,280 of the contracts traded.
Settlement prices are in Canadian dollars per metric tonne.
The soybean market posted mild gains on Tuesday as traders reacted to the USDA’s monthly supply and demand report.
The USDA lowered its estimate for the size of this year’s drought-ravaged Argentine soybean crop to 40.0 million tonnes. This was bullish news for exporters in the United States as some estimates last month projected the crop at 46.5 million tonnes. It also is drastically lower than last year’s total of 57.8 million.
The news that U.S. soybean exports are on track to meet this year’s target, despite the trade battles between China and the U.S., was also deemed supportive for the market.
The USDA reduced its estimate for this year’s ending stocks to 550 million bushels, which was down five million from the previous estimate.
Corn ended roughly a cent weaker on Tuesday, after the USDA pegged this year’s corn crop in Argentina at 33 million tonnes. That compares to last year’s haul of 41 million.
The USDA raised its estimate for the U.S. corn surplus to 2.18 billion bushels. Traders were already worried about the large supply of corn in U.S. bins before the report, so this should add to those worries.
There are continued ideas that inclement weather in the eastern U.S. Plains could reduce corn acreage this spring.
Wheat futures in Chicago finished a few cents higher on the day while markets in Minneapolis and Kansas City were close to unchanged.
The market took some strength from the dry, cold conditions in the U.S. Plains.
The agency pegged global wheat inventories at 271.2 million tonnes, which was much higher than last year’s figure of 254.6 million.
