By Dave Sims and Phil Franz-Warkentin, Commodity News Service Canada
Winnipeg, Mar. 1 – THE ICE Futures Canada canola market continued to climb higher on Wednesday, taking strength from the rising US soy complex.
Ongoing uncertainty over what the US government plans to do with bio-fuel regulations in the US pushed soy prices higher which underpinned canola. Going forward however, it is unclear what this could mean for canola’s direction, a trader in Winnipeg sad.
“We need some clarification about what’s going on with the mandate,” he said.
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The rally in soyoil has helped elevate crush margins on the Prairies.
Advances in Malaysian palm oil futures and European rapeseed
futures helped underpin the market while commercial demand remains solid.
However, the rapidly-advancing soybean harvest in South America dragged on values.
Expectations of large US soybean acreage undermined prices.
Around 24,708 canola contracts were traded on Wednesday, which
compares with Tuesday when around 48,041 contracts changed hands. Spreading accounted for about 8,652 of the contracts traded.
Milling wheat, barley and durum were all untraded.
Settlement prices are in Canadian dollars per metric tonne.
SOYBEAN futures at the Chicago Board of Trade were up 11 to 16 cents per bushel on Tuesday, seeing some follow-through buying interest after Tuesday’s rally.
Ongoing uncertainty over possible changes to the US renewable fuels policy remained supportive for soybeans, as the rumours include talk of credits for biodiesel and restrictions on imports.
Weather concerns in parts of Brazil, and reports of logistics issues moving recently harvested soybeans from the countryside to port positions, added to the firmer tone.
However, expectations for large US soybean seedings this spring tempered the advances.
SOYOIL futures were up sharply on Wednesday, as continued optimism over the potential for increased demand from the renewable fuels sector provided support.
SOYMEAL futures were stronger on Wednesday, moving in sympathy with soybeans and soyoil.
CORN futures in Chicago were up by seven to nine cents per bushel on Wednesday, as the talk of possible changes to the biofuels policy remained supportive.
Weekly US ethanol production topped one million barrels for the 18th straight week, which contributed to the firmer tone.
Chart-based buying was a feature, as the nearby technical signals point higher.
WHEAT futures in Chicago were up by 10 to 13 cents per bushel on Wednesday, as reports of solid export demand provided support.
Egypt tendered to purchase 535,000 tonnes of wheat in the international market, which would be its largest purchase in two years.
Mounting dryness concerns in some US winter wheat growing areas were also supportive, according to participants.
However, world wheat supplies remain large overall, limiting the upside.
