By Terryn Shiells and Phil Franz-Warkentin, Commodity News Service Canada
WINNIPEG, Oct. 24 – ICE Futures Canada canola contracts ended sharply lower on Friday, undermined by profit taking on recent gains and ahead of the weekend.
Spillover pressure also came from the declines seen in Chicago soybean and soyoil futures.
Some of the selling was linked to news of a massive explosion at the Louis Dreyfus crushing plant near Yorkton, Saskatchewan. If the damage is bad enough to shut the plant down, demand for Canadian canola supplies would be reduced in the short term, analysts said.
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Glacier FarmMedia — The ICE Futures canola market was weaker on Friday, taking back Thursday’s gains as losses in Chicago…
Ideas that Canadian canola crop prospects are looking larger than earlier estimates added to the bearish tone.
The Canadian currency was holding steady, providing little direction for canola.
About 33,168 contracts traded on Friday, which compares with Thursday when 29,679 contracts changed hands.
Milling wheat, durum, and barley futures were untraded and unchanged.
SOYBEAN futures at the Chicago Board of Trade were down 12 to 16 cents per bushel on Friday, seeing a correction following Thursday’s sharp gains.
After hitting the ten dollar per bushel mark for the first time in a month-and-a-half, profit-taking came forward to weigh on soybean prices on Friday, according to participants.
Forecasts calling for relatively favourable harvest weather across the Midwest through the upcoming week added to the softer tone, as farmers are expected to make good progress bringing in this year’s record large crop.
Recent rainfall in Brazil was also bearish for soybeans, as the moisture will help recently planted crops there.
SOYOIL futures were down on Friday, following soybeans.
SOYMEAL futures were down on Friday, taking some direction from the losses in soybeans.
CORN futures in Chicago were down five to seven cents per bushel on Friday, as the improving US harvest weather weighed on prices.
Increased farmer selling contributed to the losses, according to participants.
However, solid end-user demand on the other side did provide some underlying support.
WHEAT futures in Chicago were down eight to nine cents per bushel on Friday, taking some direction from the losses in the neighbouring agriculture markets.
In addition to the chart-based selling improving moisture conditions for the winter wheat crops in the southern US Plains contributed to the softer tone, said participants.
On the other side, weather concerns in other wheat growing regions of the world, such as Russia and Australia, did provide some support. Ideas that US wheat is looking more attractively priced in the international market were also supportive.
– Argentina will release an additional 400,000 tonnes of wheat for export, according to reports. The expanded quota is on top of the 1.5 million tonnes of wheat the country has already exported.
– Russian analysts SovEcon are forecasting grain production in 2015 at 90 million tonnes, which would be down 15% to 20% from the current crop. Of that total, wheat could drop to 40 million tonnes, from about 58 million in 2014. In addition to the poor conditions for the winter crops being seeded now, the weakening Russian ruble may also limit spring seedings, according to the group.
– Egypt bought 60,000 tonnes of wheat from Romania in its latest tender.
ICE Futures Canada settlement prices are in Canadian dollars per metric ton.
