By Phil Franz-Warkentin and Jade Markus, Commodity News Service Canada
Winnipeg, Dec. 15 – ICE Futures Canada canola contracts moved lower on Tuesday, backing away from nearby chart resistance as losses in the CBOT soy complex spilled over to weigh on prices.
With no real fresh fundamental news for canola, chart based selling was a feature as the Canadian oilseed tracked the movements in soybeans and soyoil, according to participants.
The large supply situation in Western Canada remained a bearish influence in the background as well, although farmer selling has quieted down for the time being as many producers move to the sidelines ahead of the New Year.
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Continued weakness in the Canadian dollar helped keep canola well supported, as the softer currency makes exports more attractive and helps boost domestic crush margins.
About 24,023 canola contracts were traded on Tuesday, which compares with Monday when 24,676 contracts changed hands. Spreading accounted for 16,486 of the contracts traded.
Milling wheat and durum were both untraded, while barley moved lower in light two-sided commercial activity.
SOYBEAN futures at the Chicago Board of Trade closed six to eight-and-a-half cents per bushel lower on Tuesday ahead of a US Federal Reserve announcement.
The Fed is expected to raise interest rates this week, which would pressure US commodities as the greenback moves higher.
The expectation that Argentina will soon remove its export tax further added to the bearish tone.
SOYOIL prices settled lower on Tuesday as the proposal for a biodiesel tax credit moved through US Congress, which would remove subsidies and potentially affect production.
SOYMEAL closed weaker on Tuesday.
CORN futures closed one to two cents per bushel weaker on Tuesday, as the market positioned ahead of the Fed decision.
A stronger US dollar was also bearish for corn.
Market watchers say demand for US grains is weak, which further pressured prices.
WHEAT closed one cent per bushel higher on Tuesday as investor short covering supported the market.
However the expectation of increased wheat exports from Argentina and positioning ahead of Wednesday’s Fed meeting limited gains.
– Weekly export inspections totaled 15.9 million bushels, according to the United States Department of Agriculture.
– Algeria purchased at least 800 thousand tonnes of wheat in tenders last week, according to reports out of the country.
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