By Dave Sims, Commodity News Service Canada
Winnipeg, July 6 (CNS Canada) – Canola contracts on the ICE Futures Canada platform finished higher on Friday, taking strength from solid gains in soybeans and soyoil.
Traders were squaring positions before the weekend.
Much of Western Canada is expecting hot temperatures over the weekend and early into next week, which should stress some areas of Saskatchewan and Alberta.
Today seemed to be a classic case of “sell the rumour, buy the fact” as China’s implementation of tariffs on U.S. soybeans failed to pressure oilseed markets.
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“A lot of the negative news was already priced in so the pendulum swung the other way,” said an analyst in Winnipeg.
However, strength in the Canadian dollar, relative to its U.S. counterpart, made canola less attractive to out-of-country buyers.
Volumes were relatively light as some traders stepped to the sidelines, waiting for the expected turbulence from today’s tariff deadline to clear.
About 13,093 canola contracts traded, which compares with
Thursday when 12,293 contracts changed hands. Spreading accounted for 4,486 of the contracts traded.
Settlement prices are in Canadian dollars per metric tonne.
Soybean futures on the Chicago Board of Trade corrected sharply higher Friday, as traders went bargain-hunting in the morning amid ideas the market was oversold. The market was also undergoing a bit of a correction after dropping earlier this week on fears of what impact Chinese tariffs would have on the U.S. soybean market.
Informa Economics pegged the U.S. soybean yield at 49.8 bushels an acre. That is up slightly from the previous estimate.
Some soybean fields in the Midwest are suffering from excess moisture while other fields in the U.S. Plains are in need of rain.
Corn futures posted gains with speculative buying.
Informa raised its U.S. corn yield estimate to 176 bushels an acre, which was up by roughly 1.5 bushels over the previous forecast.
The removal of Scott Pruitt as head of the Environmental Protection Agency has thrown some uncertainty into the market. There seems to be some questions over what this will mean for ethanol blending requirements.
Chicago wheat futures ended higher, taking strength from gains in corn and some technical buying.
The USDA’s projection of lower wheat supplies around the globe continued to underpin prices.
The next week is expected to be dry in the U.S. Plains, which was supportive for prices.
