By Terryn Shiells and Dave Sims, Commodity News Service Canada
WINNIPEG, Nov 26 – ICE Futures Canada canola contracts ended lower on Wednesday, amid a volatile trading day ahead of Thanksgiving in the US on Thursday. US markets will be closed, while Canadian markets will remain open.
Profit taking on recent gains and weakness in outside oilseed markets, including European rapeseed, Chicago soybeans and Malaysian palm oil futures, were bearish.
The upswing in the value of the Canadian dollar, good conditions for South American soybeans and the large US bean crop further undermined values.
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However, farmers remain slow sellers of Canadian canola, as they wait for stronger prices and the new tax year, which was supportive.
Spillover buying from the gains in Chicago soyoil and solid demand for canola also tempered the declines.
About 17,756 contracts changed hands on Wednesday, which compares with Tuesday when 14,065 contracts traded.
Milling wheat, durum and barley futures were untraded and unchanged.
SOYBEAN futures in Chicago ended two to four cents per bushel lower Wednesday due to increased farmer selling and fears that strengthening US prices could curb demand from China.
Prices for soybeans are roughly 15 percent higher than on October 1, prompting some growers to free up their supplies and restock the pipeline, according to a report.
Traders were also positioning themselves ahead of the Thanksgiving Day holiday, and Monday’s USDA weekly crop report which is expected to show that the soybean harvest is virtually finished, participants said.
SOYOIL futures were mostly higher on Wednesday, with spreading against soymeal a feature.
SOYMEAL futures were mixed, with the near-term values higher while the more-deferred contracts were lower in sympathy with soybeans.
CORN futures in Chicago ended three to four cents per bushel higher Wednesday as large funds added to their positions, betting that fewer acres of corn would be planted next season, according to a report.
Thin volumes exaggerated the upward momentum as investors positioned themselves before the Thanksgiving Day holiday.
Exports are on the uptick with South Korea purchasing 123,000 tonnes of US and optional corn, according to a report.
China has officially begun stockpiling corn for its state reserve. The process is expected to continue until April.
Cheap corn from the European Union is primarily being bought by the Middle East and North Africa, while Southeast Asia is mainly buying wheat from the Black Sea region, according to a report.
WHEAT futures in Chicago settled four to 10 cents per bushel higher on concerns that frigid temperatures in the US have damaged the winter wheat crop. Analysts say the recent cold snap in the US Plains arrived before many plants had entered their dormancy phase.
Cold weather in Russia and Eastern Europe has also increased the chance of lower outputs there.
There are ideas Brazil may need to keep importing hard red winter wheat from the US due to the poor quality of its own crop.
– South African has raised its forecast for wheat production by 0.2 percent, according to a report. Local farmers will probably produce 1.79 million metric tonnes of cereal in the 2014/15 year, say market-watchers.
– Bangladesh has put out a tender for 50,000 tonnes of wheat in a bid to boost the country’s reserves.
– Japan has cancelled a tender to buy 120,000 tonnes of wheat and 200,000 tonnes of feed barley.
ICE Futures Canada settlement prices are in Canadian dollars per metric ton.
