By Dave Sims and Phil Franz-Warkentin, Commodity News Service Canada
Winnipeg, Nov. 17 – The ICE Futures Canada canola market settled higher on Monday – following gains in the Chicago soy complex.
Values were following a more typical pattern, according to an analyst, now that the logistical problems gripping soymeal shipments appear to have relaxed.
Lukewarm farmer sales helped to underpin the market while the Canadian dollar was slightly lower relative to its US counterpart, which helps crush margins and also makes canola more attractively priced to international customers.
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There was a report that a US customer was forced to bring in 25,000 metric tonnes of rapeseed meal from Germany due to problems with Canadian deliveries.
However, the prospects for soybean production in South America appear favorable, which limited the gains.
Earlier losses in European rapeseed futures and Malaysian palm oil also pressured values.
Around 14,578 canola contracts were traded on Monday, which compares with Friday when around 17,034 contracts changed hands. Spreading was a feature, accounting for 7,870 of the contracts traded.
Milling wheat, durum, and barley were all untraded.
Settlement prices are in Canadian dollars per metric ton.
SOYBEAN futures at the Chicago Board of Trade were up 8 to 13 cents per bushel per bushel on Monday, recovering from earlier losses by the close as solid export and domestic crusher demand provided support.
The USDA reported that 3.1 million tonnes of soybeans were inspected for export over the past week, which was at the high end of trade guesses and the most ever inspected in a single week. Demand from domestic crushers also remains strong, with 157.96 million bushels crushed in October, according to a report from the National Oilseed Processors Association.
While the strong demand was supportive, the record large US crop did temper the upside potential as the harvest winds up across the Midwest.
SOYOIL futures finished higher on Monday, following soybeans.
SOYMEAL futures were stronger on Monday, boosted by solid end user demand and ongoing logistics issues across the Midwest.
CORN futures in Chicago were down one to four cents per bushel on Monday, with profit-taking following recent gains behind some of the weakness.
Soft end user demand contributed to the declines in corn, with the USDA reporting weekly US corn export inspections below trade guesses at 401,000 tonnes.
The record large US corn crop also remained a bearish influence overhanging the market.
WHEAT futures in Chicago were down eight to nine cents per bushel on Monday, with disappointing export data behind much of the selling pressure.
The USDA reported that only 139,000 tonnes of US wheat were inspected for export during the past week, which was below expectations and seen as a sign that US wheat remains expensive in the global market.
Profit-taking, after wheat posted large gains during the previous week, weighed on wheat prices as well.
On the other side, concerns that cold temperatures across much of the US Plains could damage winter wheat crops at this stage of development did provide some underlying support.
– The Islamic State (ISIS/ISIL) now controls roughly 40% of Iraq’s grain growing land, and has stolen more than one million tonnes of wheat and other grain from the country and moved it to Syria, according to a statement from Iraq’s agriculture minister.
– Kazakhstan grew 13.0 million tonnes of wheat during the past growing season, which was down from 13.9 million the previous year, according to a report from the USDA’s Foreign Agriculture Service. Total wheat exports from the country are forecast at 6.0 million tonnes, down from 7.5 million in 2013/14.
– Australia’s 2014/15 wheat production will be down by 14% compared to the previous year, according to a report from Rural Bank and Rural Finance (RBRF) that pegged national wheat production at 23.3 million tonnes. While Western Australia had a good crop, dryness caused problems in other wheat growing regions of the country.
