By Terryn Shiells and Dave Sims, Commodity News Service Canada
WINNIPEG – The ICE Futures Canada canola market was stronger on Wednesday, reacting to the falling value of the Canadian dollar. The weaker currency makes canola more attractively priced to crushers and foreign exporters.
Commercial demand remains steady for Canadian canola, which was also bullish, as was chart-based buying, analysts said.
Further spillover support came from the advances seen in the Chicago soy complex, Malaysian palm oil and European rapeseed futures.
Exporter pricing heading into the close helped to amplify the advances, according to traders.
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However, ongoing expectations of record large South American soybean production and ample global supplies limited the gains.
About 22,374 contracts changed hands on Wednesday, which compares with Tuesday when 17,032 contracts traded. Spreading accounted for 13,564 of the trades.
Milling wheat, durum and barley futures were all untraded. Though, the Exchange moved wheat prices higher after the close.
CORN futures in Chicago corrected two to three cents per bushel higher Wednesday. Strength in soybeans and wheat spilled over to underpin the commodity.
Futures were also boosted by a forecast from Allendale Inc., an Illinois-based brokerage firm, which predicted US farmers would plant 88.5 million acres of corn in 2015, down from 90.6 million in the previous forecast.
Government data shows an increase in ethanol production due to low stockpiles, which also pushed values higher.
SOYBEAN futures in Chicago finished six to eight cents per bushel higher Wednesday, as fears of another protest by truckers in Brazil circulated.
Recent job action disrupted the flow of some soybean shipments from Brazil’s inland areas to port, slowing exports from the South American country.
However, gains were limited by a forecast from Allendale Inc, which predicted US farmers will plant 86.1 million acres of soybeans this spring; up significantly from its previous forecast that just 83.7 million acres would be planted.
Brazil is seeing favourable harvesting weather right now, which also pressured prices.
SOYOIL futures in Chicago finished 13 to 14 points higher Wednesday, finding support from gains in Malaysian palm oil futures.
SOYMEAL futures ended slightly higher, following soybeans.
WHEAT futures in Chicago finished four to five cents per bushel higher Wednesday, as the impact of this week’s forecast by the USDA, which projected tighter-than-expected domestic supplies, continued to be absorbed by the market. Analysts suggested many traders who were locked in short positions were shocked by the projection, and were forced to exit their position and then buy-back futures, which boosted values.
Weather is warming up in the US, causing some crops to come out of dormancy. Grain prices traditionally find strength when winter-crops emerge from their winter dormancy, a participant said, because they are more prone to damage from drought, disease and pests.
Dryness in the US Southern Plains also added a weather concern to the market, according to a report.
• Australia has reached an agreement to sell 47,000 metric tonnes of milling wheat to a flour mill in South Korea.
• Officials in India say monsoon damage to the wheat crop in the province of Radi appears to be limited and shouldn’t lead to any shortfalls in production targets, according to a report.
• Pakistan is preparing to sell 1.2 million tonnes of surplus wheat, according to a report.
ICE Futures Canada settlement prices are in Canadian dollars per metric ton.
