By Phil Franz-Warkentin, Commodity News Service Canada
February 2, 2015
Winnipeg – ICE Futures Canada canola contracts settled with small losses on Monday, as speculative long liquidation and a firmer Canadian dollar weighed on values.
Activity was choppy and two sided, although the bias was clearly to the downside with fund traders said to be liquidating some of their large long positions and booking profits.
A stronger tone in the Canadian dollar, which was up by over half a cent relative to its US counterpart, also accounted for some of the weakness in canola, said traders.
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On the other side, gains in CBOT soyoil did provide some underlying support for canola. Solid end user demand also helped limit the losses.
About 13,399 canola contracts were traded on Monday, which compares with Friday when 22,752 contracts changed hands. Spreading accounted for 9,602 of the contracts traded.
Milling wheat, durum, and barley were all untraded.
SOYBEAN futures at the Chicago Board of Trade were down one to three cents per bushel on Monday, after trading to both sides of unchanged in choppy activity.
Heavy snowfall across parts of the Midwest accounted for some underlying strength in beans throughout the session, as the winter weather will likely slow movement across the countryside.
Solid weekly US export inspections, of nearly 1.7 million tonnes, also helped underpin the soy market.
SOYOIL futures were up on Monday, as gains in crude oil and most outside vegetable oil markets provided support.
SOYMEAL futures were down on Monday, with positioning against soyoil behind some of the weakness.
CORN futures in Chicago were narrowly mixed on Monday, finishing within two cents of unchanged. However, the bias was to the downside in the most active contracts at the close.
The situation in corn was similar to beans, with nearby US weather issues being offset by the large South American production prospects.
WHEAT futures in Chicago were down by nine to 11 cents per bushel on Monday, as bearish technical signals and improving winter wheat conditions across the Midwest weighed on values.
The winter storm that was supporting corn and beans was bearish as far as wheat was concerned, as many winter wheat fields were in need of some added snow cover.
Chart based selling contributed to the eventual declines in wheat, as the move below the psychological 5 dollar mark in the nearby contract triggered some sell stops.
Weekly US wheat export inspections came in at 394,000 tonnes, which was up from the previous week and helped provide some underlying support. The ongoing uncertainty over exports from Russia and Ukraine also remained a factor in the background.
Settlement prices are in Canadian dollars per metric ton.
