By Dave Sims and Jade Markus, Commodity News Service Canada
Winnipeg, December 8 – THE ICE Futures Canada canola market chalked up gains Tuesday, as improving crush margins and currency issues led the way higher.
The Canadian dollar was half a cent lower relative to its US counterpart, which typically makes canola more attractive to foreign buyers.
Canola was also correcting somewhat from yesterday’s losses and gains in Chicago soyoil were supportive.
However, Chicago soybeans and soymeal were lower which tempered the gains. Crude oil was also weaker which undermined the market.
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Malaysian palm oil and European rapeseed futures also suffered losses which were bearish.
An improving soybean crop in Brazil is only expected to get better with rain.
Around 38,320 canola contracts were traded on Tuesday, which compares with Monday when around 31,253 contracts changed hands. Spreading accounted for 32,794 of the contracts traded.
Milling wheat, barley and durum were untraded.
Settlement prices are in Canadian dollars per metric ton.
SOYBEAN futures at the Chicago Board of Trade closed five and a half to six and a quarter cents per bushel lower on Tuesday as traders took positions ahead of a report from the United States Department of Agriculture (USDA) due out on Wednesday.
Many market watchers expect domestic stocks to be revised upward in the report, which is bearish.
Improved growing conditions in Brazil and a favourable outlook further added to the bearish tone.
SOYOIL prices settled stronger on Tuesday, adjusting against soymeal.
SOYMEAL closed weaker on Tuesday.
CORN futures closed unchanged to one and a half cents per bushel higher on Tuesday, as strong ethanol demand from China propped up
prices.
South American weather has not been favourable for corn production, according to reports, which was also bullish.
However the expectation that the USDA report will show ample domestic supplies put a lid on gains.
WHEAT closed half a cent higher to two and a quarter cents per bushel weaker on Tuesday, also positioning ahead of Wednesday’s supply and demand report from the USDA.
Many traders expect the outlook for wheat to be bearish, especially as global supplies of the commodity are already high.
Favourable conditions for US winter wheat production further pressured prices.
– Market estimates peg the USDA’s supply and demand report wheat projection at 918 million bushels.
– India’s wheat seeding is a week behind the five-year average, according to reports out of the country.
