By Phil Franz-Warkentin and Jade Markus, Commodity News Service Canada
Winnipeg, Dec. 18 – ICE Futures Canada canola contracts were stronger on Friday, seeing a correction off of nearby support as gains in the US soy complex and continued weakness in the Canadian dollar provided support.
Exporters and domestic crushers were both said to be showing solid demand, while farmer selling on the other side was backing away heading into the New Year.
Speculative buying, as canola bounced off of nearby chart support, contributed to the gains. However, the market is still range-bound overall with resistance holding to the upside.
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The large supply situation across the Prairies also tempered the gains, according to participants.
About 26,842 canola contracts were traded on Friday, which compares with Thursday when 27,468 contracts changed hands. Spreading accounted for about 21,738 of the contracts traded.
Milling wheat, durum, and barley futures were all untraded, although wheat was revised after the close.
SOYBEAN futures at the Chicago Board of Trade closed eleven to fifteen cents per bushel higher Friday as traders took positions before the end of the year.
Despite weak export data released by the United States Department of Agriculture (USDA) for the week ended December 10, many investors expect demand to pick up.
The weather in Brazil has also been bullish for soybeans, as dry conditions in the country put crops at risk, market watchers say.
An estimate from Informa Economics also supported prices on Friday, as US farmers are expected to plant fewer acres of soybeans in 2016.
Informa Economics’ newest estimate projects 84.5 million acres, compared to the previously forecasted 85.3 million.
SOYOIL prices settled higher on Friday, following soybean futures.
SOYMEAL closed stronger on Friday.
CORN futures closed mostly unchanged on Friday as traders factored in a fresh acreage estimate from Informa Economics, and export numbers from the USDA.
Informa Economics expects US corn acreage to decrease next year, with farmers planting 88.9 million acres compared with the previous estimate of 90.1 million acres.
Spillover support from the nearby wheat market also prevented losses.
But export numbers from the USDA capped any gains on Friday.
Net sales of corn totalled 579,400 metric tonnes for 2015/2016. That figure was down 44 per cent from the previous week and down 47 per cent from the prior four-week average, the USDA said in its most recent export report.
WHEAT closed two to three cents per bushel higher on Friday as the US dollar lost some ground.
The dip in the currency could make wheat more affordable for the time being, though overall the greenback remains strong.
Traders closing bearish bets as the end of the year nears also supported prices on Friday.
– The European Union granted 1.1 million tonnes of soft wheat export licenses in the past week, according to analyst reports.
– Some market watchers are concerned that the expected influx of Argentinian wheat may be poor quality.
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