North American Grains/Oilseed Review – Canola rises with outside markets

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Published: August 9, 2016

By Dave Sims and Jade Markus, Commodity News Service Canada

Winnipeg, August 9 – THE ICE Futures Canada canola market finished stronger on Tuesday, in sympathy with US soyoil and some technical buying.

Supplies of Malaysian palm oil are on the small side, which helped to push canola and other oilseeds higher, according to a report.

Wet weather has created soggy conditions in some parts of Western Canada, which was bullish for canola.

Demand reportedly remains firm, while gains in crude oil contributed to the upside.

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However, the Canadian dollar was slightly stronger relative to its US counterpart, which made canola less enticing to buyers overseas.

The US soybean crop is expected to be quite large this year, which was bearish for values.

At one point, the front-month November contract broke above technical resistance but ultimately settled just below it.

Around 18,372 canola contracts were traded on Tuesday, which
compares with Monday when around 10,679 contracts changed hands. Spreading accounted for about 9,206 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 one cent lower to four cents per bushel higher on Tuesday.

Front contracts were supported by strong demand, as China has bought an increased amount of soybeans in recent weeks.

Deferred contracts felt pressure from a favourable crop conditions report released by the United States Department of Agriculture (USDA).

Soybean crop conditions are steady on the week, with 72 per cent expected to be in good to excellent condition, which is nine points ahead of year-ago levels.

SOYOIL prices closed higher on Tuesday, tracking advances in Malaysian palm oil.

SOYMEAL closed stronger on Tuesday.

CORN futures were one to three cents per bushel weaker on Tuesday, despite a drop in crop condition ratings.

US corn crop ratings dropped slightly on the week, moving two points lower with 74 per cent in good to excellent condition.

Despite the lower rating, the news still had a bearish effect, as it’s ahead of year-ago levels, and traders expect corn production to be large this year.

Mostly benign weather in key US growing regions added to the bearish tone.

WHEAT closed mostly unchanged on Tuesday, as crop loss in France balanced high production from Russia.

Heavy rain and flooding in France has reduced the country’s wheat output.

Russia’s yields are expected to be up from year-ago levels, which is bearish.
– Russia’s wheat harvest is expected to be 42 per cent finished, according to reports out of the country.
– The US winter wheat harvest is expected to be 94 per cent complete, market watchers say.

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