By Dave Sims and Phil Franz-Warkentin, Commodity News Service Canada
Winnipeg, November 19 – The ICE Futures Canada canola market ended weaker on Wednesday in sympathy with the US soy complex.
While canola has held relatively steady in recent days, pressure is increasing on the US markets, which canola has been unable to escape from, according to an analyst.
He added the soymeal premium, which had existed in recent weeks due to logistical problems with US railways, has pretty much disappeared.
Earlier pressure from European rapeseed futures and Malaysian palm oil also weighed on values.
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However, solid demand for canola and a weaker Canadian dollar limited the losses.
Farmer selling isn’t likely to ramp up anytime soon, according to a report, as many producers will want to wait until the new tax season begins in January.
Around 16,302 canola contracts were traded on Wednesday, which compares to Tuesday when around 16,035 contracts changed hands.
Milling wheat, durum, and barley were all untraded.
SOYBEAN futures at the Chicago Board of Trade were down 15 to 18 cents per bushel per bushel on Wednesday, as farmer selling and bearish technical signals weighed on values.
With the Midwestern harvest nearing completion, the resulting increase in farmer deliveries accounted for some of the weakness in the futures, according to participants.
Some speculative sell stops were also hit on the way down, as fund traders booked profits.
However, solid end user demand did remain a supportive factor as the export pace remains strong.
SOYOIL futures finished lower on Wednesday, following soybeans.
SOYMEAL futures were down on Wednesday, as concerns over tight nearby supplies of the livestock feed subside.
CORN futures in Chicago were down eight to nine cents per bushel on Wednesday, as speculative profit-taking continued to weigh on prices.
A lack of significant end user demand, spillover from the losses in soybeans, and bearish chart signals all contributed to the declines.
However, cold and snowy weather conditions were delaying the final harvest operations in some parts of the Midwest, which provided some underlying support.
WHEAT futures in Chicago were down 10 to 11 cents per bushel on Wednesday, as speculators backed away from the market. Poor export demand contributed to the declines, as US wheat remains expensive in the global market.
However, colder-than-normal temperatures for this time of year across much of the US Plains did provide some support as the freezing weather may damage the US winter wheat crop.
– Ukraine is forecast to export a record 10.35 million tonnes of wheat in 2014/15, according to a report from APK-Inform. The Kiev-based consultancy firm also forecast that Ukraine would harvest 23.3 million tonnes of wheat this year, up 5% from the previous year. However, production in 2015/16 could be down due to the ongoing conflict in the country and resulting drop in winter wheat plantings.
– France has reportedly sold a shipment of wheat to the US for the first time in 12 years. Adverse weather conditions left Europe’s largest wheat producer with large supplies of low quality wheat that it is now looking to move on the world market.
Settlement prices are in Canadian dollars per metric ton.
