By Dave Sims and Jade Markus, Commodity News Service Canada
Winnipeg, August 8 – THE ICE Futures Canada canola market chalked up modest gains Monday, tracking advances in the US soy complex.
Some funds were out bargain-hunting which was supportive along with gains in Malaysian palm oil, European rapeseed futures and crude oil.
Volumes were relatively light which may have helped exaggerate the advances in canola, according to a Winnipeg-based trader.
He added a looming deadline by China that would limit the amount of dockage allowed in imports of Canadian canola was also creating some turmoil in the market.
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“That September 1 deadline is getting really close, creeping up,” he said.
However, the Canadian dollar was slightly higher relative to its US counterpart, which made canola less attractive to out-of-country buyers.
Around 10,679 canola contracts were traded on Monday, which
compares with Friday when around 19,190 contracts changed hands. Spreading accounted for about 3,920 of the contracts traded.
Milling wheat, barley and durum were all untraded.
Settlement prices are in Canadian dollars per metric tonne.
SOYBEAN futures at the Chicago Board of Trade closed stronger on Monday, underpinned by strong export demand.
Analysts say more than two million tonnes of daily sales were announced last week, which is supportive.
Dry weather is forecast for the US Midwest within the next two weeks, which further propped up prices as crops are in a key development phase.
However, the expectation that this year’s harvest will be large capped advances.
SOYOIL prices closed higher on Monday.
SOYMEAL closed stronger on Monday.
CORN futures were mostly higher on Monday, gathering spillover support from outside markets.
Advances in crude oil were bullish for corn, as the commodity is used in ethanol production.
Stronger energy prices increase the likelihood that processors will blend above mandated amounts of biofuel.
Advances in the nearby soybean market further supported prices.
Trader positioning ahead of key reports due out on Friday from the United States Department of Agriculture was a feature. Traders expect the reports to reflect large production.
WHEAT closed mostly unchanged on Monday, with front contracts supported by crop-loss in France. The country’s crop-production this year is expected to reach a 30-year-low.
Investor short-covering was also a feature.
However, deferred contracts were pressured by the expectation for large Canadian and US crops.
– France’s wheat harvest has been pegged at 62 per cent complete, according to reports out of the country. That is 20 per cent behind last year’s pace.
– Analysts expect about half of France’s wheat crop may be feed wheat.