By Phil Franz-Warkentin and Jade Markus, Commodity News Service Canada
Winnipeg, Sept. 22 (CNS Canada) – ICE Futures Canada canola contracts were up sharply on Thursday, as news broke that Canada and China had reached an agreement on exports.
China’s Premier Li Keqiang was in Ottawa to meet with Canadian Prime Minister Justin Trudeau, and the two leaders announced an agreement that will see Canadian canola continue to move to China with up to 2.5 per cent dockage until at least 2020 as further studies take place. China had been set to lower acceptable dockage levels to one per cent, which Canadian traders said would cut into exports.
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Gains in Chicago Board of Trade soyoil futures and persistent harvest delays in parts of Western Canada were also supportive, with adverse weather causing some industry participants to reconsider their optimistic production forecasts.
The Canadian dollar was stronger relative to its US counterpart, which tempered the advances in canola. Soybeans also backed away from earlier gains in Chicago to settle well off their daily highs.
About 37,359 canola contracts were traded on Thursday, which compares with Wednesday when 21,025 contracts changed hands. Spreading accounted for 22,886 of the contracts traded.
Milling wheat, durum, and barley were all untraded, although prices were revised after the close.
SOYBEAN futures at the Chicago Board of Trade closed unchanged to one cent per bushel higher on Thursday, underpinned as rain in parts of the US is slowing harvest.
Losses in the US dollar also had a bullish effect on prices.
However, weaker than expected export sales put a lid on advances.
SOYOIL prices were higher on Thursday, tracking advances in Malaysian palm oil.
SOYMEAL closed weaker on Thursday.
CORN futures were about three cents per bushel weaker on Thursday, pressured by chart-based resistance.
However, a number of bullish factors remain, which could support the market moving forward.
Strong export sales limited losses on Thursday.
Market watchers say rain is stalling harvest-progress in parts of the US Midwest, which further capped declines.
WHEAT closed one to two cents per bushel weaker on Thursday, pressured by a bearish supply and demand situation.
However, weakness in the US dollar and stronger-than-expected export sales limited losses.
– Egypt has said it will go back to international standards for ergot tolerance, market watchers say.
– Export sales reached 561,000 metric tonnes for delivery in marketing year 2016/2017 in the week ending September 15, The United States Department of Agriculture said in a report.
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