By Dave Sims and Phil Franz-Warkentin, Commodity News Service Canada
Winnipeg, January 19 – THE ICE Futures Canada canola market settled higher on Thursday, taking strength from action in the Canadian currency.
The Canadian dollar was lower relative to its US counterpart, which made canola more attractive to foreign buyers.
Short-covering was a feature of the day’s activity, according to a trader in Winnipeg. He added some traders may also have been positioning themselves ahead of Friday’s US inauguration, to shield themselves from any major moves in the Canadian currency.
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“I guess there is some uncertainty about Trump so that may be encouraging some short-covering in case the Canadian dollar continues to slide,” he explained.
On the other side, losses in Chicago Board of Trade soybeans and soyoil were bearish for canola.
Dry weather is expected to arrive in wet regions of Argentina, which should allow farmers to resume planting.
Milling wheat, barley and durum were untraded.
About 24,748 canola contracts traded on Thursday which compares with Wednesday when 23,081 contracts changed hands.
Settlement prices are in Canadian dollars per metric tonne.
SOYBEAN futures at the Chicago Board of Trade were narrowly mixed on Thursday, although the bias was lower with the most active nearby contracts all down on the day.
Ideas that recent gains were overdone accounted for some of the selling pressure, as farmer hedges also came forward to weigh on values.
Improving weather forecasts out of Argentina added to the softer tone, with drier conditions likely to benefit some fields.
SOYOIL futures settled lower on Thursday.
SOYMEAL futures were down on Thursday, following soybeans.
CORN futures in Chicago were steady to up two cents per bushel on Thursday, with solid export demand behind some of the strength.
The USDA reported a fresh sale of 110,400 tonnes of US corn to unknown destinations for delivery during the current marketing year.
Supportive technical signals added to the firmer tone, although corn was running into resistance near its six-month highs.
WHEAT futures in Chicago were down by four to seven cents per bushel on Thursday, with chart-based selling a feature as the market backed away from recent gains.
Strength in the US dollar index contributed to the declines, as the firmer currency should cut into export demand.
However, the spring wheat market in Minneapolis saw gains in the front months, with inter-month spreading a feature there.
