By Dave Sims, Commodity News Service Canada
Winnipeg, September 29 (CNS Canada) – The ICE Futures Canada canola market finished higher on Friday, taking strength from gains in US soybeans.
The market rose soon after the USDA released a report this morning that was deemed bullish. In its quarterly stocks report, the agency pegged US soybean stocks at 301 million bushels, the number was much higher than last year but it still failed to meet analysts’ expectations.
Cool, wet weather is expected to fall on Alberta this weekend, which should cause additional delays for the harvest.
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Global demand for canola remains strong, according to an analyst in Winnipeg.
“Chinese buying interest, to me, has the potential to be 5 million tonnes (total for the marketing year) from Canada,” he said.
However, farmers have been making a lot of “off-the-combine” deliveries, which was bearish for prices.
Seasonal harvest pressure dragged on values.
Around 17,586 canola contracts were traded on Friday, which
compares with Thursday when around 10,776 contracts changed hands. Spreading accounted for 8,992 of the contracts traded.
Milling wheat, barley and durum were all untraded.
Settlement prices are in Canadian dollars per metric tonne.
Soybeans finished seven to eight cents higher on Friday after the USDA’s bullish quarterly stocks report. Heading into the report, most traders thought the USDA would peg soybean stocks, as of September 1, at 338 billion bushels, but the agency surprised many when it put the number at 301 million instead. While that is much higher than last year’s total of 197 million bushels, it still prompted a slew of buying.
Strength in the U.S. dollar limited the gains while weather conditions in the Midwest look favourable for the harvest.
Argentina has launched talks with the U.S. in a bid to try and remove import tariffs on bio-diesel.
Corn rose by two cents, also taking strength from the USDA’s forecast.
The USDA pegged corn stocks at 2.23 billion bushels, which also failed to meet expectations as most analysts had thought the number would be slightly higher.
The corn market doesn’t have much room to the upside as U.S. farmers typically stepped in once prices moved higher and began selling old crop supplies from their vast stockpiles.
Harvest weather remains good.
Wheat was six to eight cents weaker on Friday.
The wheat market got a much different forecast from the USDA as both the stocks report and domestic production figures surpassed expectations.
The agency pegged this year’s US wheat crop at 1.74 billion bushels, which was higher than the previous estimate of 1.73 billion.
