By Phil Franz-Warkentin, Commodity News Service Canada
December 8, 2014
Winnipeg – ICE Futures Canada canola contracts settled with solid gains on Monday, seeing a continuation of Friday’s rally as fund buying interest came forward to provide support.
With no real fresh fundamental news to speak of, the gains were largely technical in nature, according to a broker who said fund traders were likely adding to their net long position.
A softer tone in the Canadian dollar and a continued lack of significant farmer selling were also supportive, said traders.
Read Also
North American grain/oilseed review: Canola falls Friday
ICE Futures canola market was weaker on Friday, settling at its weakest levels in two weeks. Speculative selling was a…
Canola remains attractively priced compared to other oilseeds as well, but exporters and domestic crushers were not thought to be chasing the market higher on Monday. A broker noted that the upward revision to the size of the Canadian canola crop in last week’s Statistics Canada production report was likely tempering some of the end user demand, as the supply/demand balance might not be as tight as originally thought.
About 33,272 canola contracts were traded on Monday, which compares with Friday when 36,333 contracts changed hands. Spreading accounted for 22,924 of the contracts traded.
Milling wheat, durum, and barley were all untraded.
SOYBEAN futures at the Chicago Board of Trade moved to both sides of unchanged on Monday, but settled with small advances of up to eight cents per bushel in most months.
Soybeans had moved up by as much as 14 cents per bushel at one point during the day, but those gains proved short lived as the market ran into resistance and backed away from its highs.
Solid export demand was a somewhat supportive factor, as the USDA reported a fresh 130,000 tonne sale of US beans to Spain this morning. However, weakness in crude oil weighed on soyoil, and the losses there weighed on the rest of the soy complex as well.
The relatively favourable South American moisture conditions put some pressure on the US futures as well.
SOYOIL futures were down on Monday, with declines in crude oil and spreading against soymeal behind some of the weakness.
SOYMEAL futures were up on Monday.
CORN futures in Chicago were chopped around both sides of unchanged on Monday, but were down four to five cents per bushel at the close.
A 136,000 tonne sale of US corn to Japan provided some early strength for the grain, as the business was seen as a sign that US supplies were once again looking more competitively priced in the international market, according to participants.
Concerns that a lack of storage space for the large US crop would lead to some quality issues for excess grain that is being put in piles outside helped underpin the futures as well.
WHEAT futures in Chicago were up one to three cents per bushel on Monday. Kansas City hard red winter wheat contracts were also up slightly, but the spring wheat traded in Minneapolis settled with losses of one to two cents per bushel.
Weather concerns in a number of winter wheat growing regions of the world remained somewhat supportive, with chart based buying interest another feature, according to participants.
However, expectations that the USDA will raise its supply projections in a report out on Wednesday, given the country’s slow export pace so far, did temper the advances.
Settlement prices are in Canadian dollars per metric ton.
