By Terryn Shiells and Dave Sims, Commodity News Service Canada
WINNIPEG, Jan. 29 – The ICE Futures Canada canola market ended mostly higher Thursday, staging a late day rally after trading lower for most of the session. The March contract saw the only losses, as traders worked to narrow the inverse in the market.
The Canadian dollar was down sharply, testing the 79 cents US mark on Thursday, which was underpinning the market. The soft loonie makes canola more attractive to buyers pricing in US dollars.
Steady commercial demand for canola and ideas that Wednesday’s large losses were overdone were also supportive.
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However, spillover pressure from the declines seen in Chicago soybean and soyoil futures was bearish.
Expectations of record large South American soybean production and comfortable supplies of Canadian canola were also overhanging the market.
About 26,196 contracts changed hands on Thursday, which compares with Wednesday when 22,793 contracts traded. Spreading accounted for 21,746 of the trades.
Milling wheat, durum and barley futures were all untraded, though the Exchange moved durum prices lower after Thursday’s close.
SOYBEAN futures in Chicago ended two to seven cents per bushel lower Thursday, as traders took profits. The market saw an early rally after better than expected US export numbers were announced.
China reportedly increased its orders for soybeans to 548,900 metric tonnes for the week ended January 22. The USDA said Germany and the Netherlands had also bumped up their orders.
A strong US dollar, large world supplies of soybeans and generally good weather for South American soybeans also contributed to the losses.
SOYOIL futures ended 77 to 80 points lower with recent news that the US Environmental Protection Agency could soon allow more Argentinian bio-diesel products that were made with soyoil into the US. It was the first time since 2009 that spot soyoil dropped below 30 cents per pound.
SOYMEAL futures ended slightly higher with spreading against soyoil a feature. Strong demand for the commodity was also bullish, traders said.
CORN futures in Chicago finished one to three cents per bushel lower Thursday as large funds engaged in technical selling. The strength of the US dollar was also a bearish force on the market.
Values were also undermined by USDA numbers which said 1.07 million metric tonnes of grain was sold to overseas buyers last week. That was roughly half the amount sold the previous week, according to a report.
March-dated futures fell below the 100-day moving average for the first time in over three months, said an analyst.
WHEAT futures in Chicago finished two cents per bushel higher Thursday and six to eight cents higher on the Kansas City Board of Trade in the wake of encouraging US export numbers.
The USDA says 544,444 metric tonnes of wheat were sold for export last week, which was within the high end of analysts’ expectations.
However, the large global grain supply and firm US dollar tempered the upside.
• Japan’s Ministry of Agriculture said it received no offers of feed-quality wheat in an auction that closed late Wednesday.
• China’s genetically modified crop planting areas declined in 2014 amid disagreements over safety concerns, according to a report.
• Libya is looking to buy 50,000 tonnes of wheat, traders said.
ICE Futures Canada settlement prices are in Canadian dollars per metric ton.
