By Jade Markus and Dave Sims, Commodity News Service Canada
Winnipeg, July 12 (CNS Canada) – ICE Futures Canada canola closed weaker on Wednesday, as an influx of factors pressured the market.
The Canadian dollar advanced more than a cent against its US counterpart following the Bank of Canada’s decision to raise the country’s interest rates. That’s bearish for canola, as a stronger domestic currency can eat into international demand.
Rain in key areas of Western Canada added to canola’s losses, as showers are likely to improve crop conditions.
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Spillover pressure from the US soy complex added to the bearish tone.
Chicago Board of Trade soybeans, soymeal and soy oil were all lower in the aftermath of the United States Department of Agriculture’s supply and demand data.
Around 23,303 canola contracts traded on Wednesday, which compares with Tuesday when around 17,202 contracts changed hands. Spreading accounted for 3,848 of the contracts traded.
WHEAT futures in Chicago dropped 14 to 16 cents per bushel on Wednesday after the United States Department of Agriculture predicted a bigger-than-expected harvest this year.
According to the USDA, forecasted wheat production will hit 1.76 billion bushels in the 2017-18 crop year. That is above what analysts had been expecting.
The agency also raised its estimate for US stockpiles to 938 million bushels. That compares to 924 million in June.
SOYBEAN futures at the Chicago Board of Trade fell four to nine cents per bushel on Wednesday. The market felt pressure from a stronger US dollar and improving weather conditions in the US Midwest.
The USDA’s monthly supply and demand report was relatively neutral for soybeans, as the agency continued to project yields at 48 bushels an acre.
Heading into the report, many traders were expecting larger projections from the USDA, which lent some support to prices.
SOYOIL futures were down 29 to 33 points on the day.
SOYMEAL futures also suffered losses, following soybeans.
CORN futures in Chicago recorded solid losses on Wednesday, dropped 11 to 16 cents, as the USDA pegged stockpiles at a figure that was larger than expected.
According to the agency, domestic corn stockpiles for 2017/18 came in at 2.325 billion bushels, which exceeded the June projection of 2.11 billion.
The news was enough to drive the dominant December contract below its key support level.
