By Jade Markus and Dave Sims, Commodity News Service Canada
Winnipeg, October 15 – THE ICE Futures Canada canola market finished weaker in sideways trading on Thursday, due to losses in the vegetable oil market and the action of the Canadian currency.
The Canadian dollar was stronger relative to its US counterpart, which made canola less attractive to domestic crushers and foreign buyers.
One analyst noted that while speculators covered short positions on Tuesday, there hasn’t been any follow-up short-covering by the speculative community to help drive the market higher.
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“So I think there’s kind of a pause in the market here,” he said.
He added farmer deliveries of canola along with US farmer deliveries of soybeans contributed to the overhead resistance.
However, commercial demand was steady while farmer deliveries haven’t been as heavy as some expected.
Canola received technical support from the key C$470 mark.
A total of 23,013 canola contracts were traded on Thursday, which compares with Wednesday when 28,793 contracts changed hands. Spreading accounted for 16,408 of the contracts traded.
Milling wheat, barley and durum were all untraded.
Settlement prices are in Canadian dollars per metric ton.
SOYBEAN futures at the Chicago Board of Trade closed two to three cents per bushel lower Thursday as harvest in the US continued.
Soybean harvest has been progressing fast due to favourable weather in the first half of October, which pressured prices.
Rain in Brazil was also bearish for soybeans, as seeding had been stalled due to dryness.
However, market watchers say losses were limited by strong demand for US oilseeds.
SOYOIL prices settled lower on Thursday.
SOYMEAL closed lower on Thursday following neighbouring grain and oilseed markets.
CORN futures closed two to three cents per bushel weaker Thursday due to harvest pressure.
Reports of larger than expected yields also had a bearish effect on prices, analysts say.
Sinking crude oil prices also pushed corn lower. Corn is a key ingredient in ethanol production, and as prices move lower, blending corn becomes less appealing.
WHEAT closed five to seven cents per bushel weaker on Thursday as there were no signs of improvement in the bearish market.
A relatively strong US dollar has made the country’s wheat uncompetitive globally, reflected in weak export data.
Analysts say global oversupply of the commodity added to the bearish tone.
– Australia has seen scattered showers, which will support the crops there, as it has been very dry.
– Reports from India suggest the country may be raising its wheat import tax from 10 per cent to 25 per cent.
