By Phil Franz-Warkentin and Dave Sims, Commodity News Service Canada
November 7, 2014
Winnipeg – ICE Futures Canada canola contracts traded to both sides of unchanged in choppy activity on Friday, but settled with small losses overall as a stronger tone in the Canadian dollar weighed on values.
The Canadian dollar was up by about three quarters of a cent relative to its US counterpart, which cuts into crush margins and also makes exports less attractive to international buyers pricing in US dollars.
However, end users were still showing good demand for canola, despite the currency-related adjustments, as they continue to work at encouraging farmer deliveries, said participants.
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Gains in CBOT soybeans were also somewhat supportive for canola, helping limit the eventual losses in the Canadian market.
About 23,863 canola contracts were traded on Friday, which compares with Thursday when 28,503 contracts changed hands. Spreading accounted for about 11,202 of the contracts traded.
Milling wheat and durum were both untraded, but barley saw some light activity and moved higher for the second straight session.
SOYBEAN futures in Chicago ended eight cents per bushel higher Friday on strong world demand, particularly for soymeal.
Dry weather in Brazil has also prompted speculation production could be lower than expected. Although weather forecasters say those worries could be alleviated if rain falls next week.
SOYOIL futures were lower on Friday, with spreading against soymeal a feature.
SOYMEAL futures were mixed on Friday, with the near-term December contract falling slightly lower while the more deferred values were higher.
Sales of US old-crop soymeal showed cancellations of 123,700 tonnes, which is unusual this early in the marketing year, according to a report.
CORN futures in Chicago ended three cents per bushel lower Friday, with forecasts calling for favourable weather over the US Midwest for much of the weekend.
US export sales were listed as 478,200 tonnes for the week which fell below analysts’ estimates of 600,000 to 800,000 tonnes.
Argentina has authorized new licenses to export 8 million metric tonnes of the new corn crop.
Fund buying and gains in the soybean complex limited the losses.
WHEAT futures in Chicago ended five cents per bushel lower due to lukewarm demand and continuing strength in the US dollar.
There are expectations US ending stocks will tilt slightly higher in the upcoming USDA supply/demand report.
Renewed tensions between Ukraine and Russia lent some underlying support to values.
– Russia’s fragile winter grain plantings are at risk, despite recent warm weather, according to a report. An early cold snap this fall has many experts warning of low yields and winterkill.
– Two mills in South Korea have reportedly bought 60,000 tonnes of milling wheat.
– Growing conditions for wheat in Australia are reported as being excessively dry in the east and too wet in the western region.
Settlement prices are in Canadian dollars per metric ton.
