By Dave Sims, Commodity News Service Canada
Winnipeg, August 11 – THE ICE Futures Canada canola market ended slightly higher on Friday, as traders squared positions ahead of the weekend.
The market is showing a lot of independent strength as tightness in canola stocks has forced the industry to begin rationing supplies, so the country doesn’t run out of canola before the new crop is ready.
Advances in US soybeans were supportive for canola.
Many sections of Western Canada require more rain. It could benefit more of the crop than usual due to the late planting season, according to a trader in Winnipeg.
“Rain would do lots. That canola won’t be harvested until mid-September,” he said.
However, the Canadian dollar was nearly half a cent stronger compared to its US counterpart, which made canola less attractive to foreign buyers.
Crush margins are at their lowest point since the summer of last year.
Around 6,355 canola contracts were traded on Friday, which compares with Thursday when around 21,869 contracts changed hands.
Milling wheat, barley and durum were all untraded.
Settlement prices are in Canadian dollars per metric tonne.
Soybeans rose four to five cents on Friday as values corrected themselves slightly in the wake of Thursday’s plunge.
Bulls in the market tried to push the market up more, but the massive projections for this year’s soybean crop in the US capped the upside.
The USDA also hiked its estimate for world soybean stocks which was bearish. There are ideas the crop is oversold.
Corn was three to four cents stronger in corrective trade.
The USDA projected corn yields of 169.5 bushels an acre in the US which surprised many.
However, many analysts don’t believe the yields are actually that high due to the scorching heat the crop has been through this year.
Signs of bird flu in the Philippines could also be bad news for the livestock feed sector.
The country has already culled 200,000 poultry to try and stem a major outbreak.
Chicago wheat finished one cent lower in chart-based trading.
The USDA projected large stockpiles of wheat in the US and around the globe, which has put a lot of pressure on the market.
Wheat futures on the Minneapolis Board of Trade plummeted to end the week, dropping 22 to 29 cents a bushel.
Weather issues were also a factor, as rain swept over the US Southern Plains yesterday.