By Glen Hallick, MarketsFarm
WINNIPEG, March 24 (MarketsFarm) – Intercontinental Exchange (ICE) Futures canola contracts were steady on Tuesday, as no one wanted to aggressively push the market either way, according to a Winnipeg-based trader.
While canola received support from strong gains in Chicago soyoil, lower soymeal and significantly reduced increases for soybeans weighed on values.
The trader noted that farmers want to sell their canola, but spring road bands across the Prairies have been an impediment.
European rapeseed dropped today, which put pressure on canola. Malaysian palm oil was steady.
By mid-afternoon Tuesday, the Canadian dollar was slightly lower at 68.97 U.S. cents, compared to Monday’s close of 69.05.
There were 16,216 contracts traded on Tuesday, which compares with Monday when 17,029 contracts changed hands. Spreading accounted for 10,776 contracts traded.
Settlement prices are in Canadian dollars per metric tonne.
Canola May 467.50 unchanged
Jul 476.00 up 0.40
Nov 483.40 up 0.40
Jan 489.40 up 0.10
SOYBEAN futures at the Chicago Board of Trade (CBOT) were slightly higher on Tuesday, a marked contrast to the 20-cent gains yesterday.
There has been renewed speculation that China could soon begin meeting its obligations as outlined in the Phase One trade deal. In the first year of the agreement, China is to purchase US$40 billion in agricultural goods from the United States. That’s US$13 billion more than what China has bought from the U.S. in any given year. In the deal’s second year China is to up its purchases to US$50 billion.
The COVID-19 pandemic poses a major obstacle to Brazil’s soybean exports, which were on pace to double from February to March. Presently, Brazil’s March exports are at 7.20 million tonnes, compared to February’s shipments of 4.99 million.
Soybean and Corn Advisor’s Dr. Michael Cordonnier lowered his estimate of Brazil’s soybean production by 1 million tonnes due to dry conditions in some parts of the country. His new forecast calls for 122.0 million tonnes.
Malaysia could see its palm oil production slashed by 25 per cent after an outbreak of COVID-19 in the country’s Sabah state. The state government ordered its palm oil plantations to be shut down. Sabah is one of Malaysia’s major palm oil producing states.
CORN futures were higher on Tuesday, due precipitation in parts of the U.S.
The Southern Plains and Central Mississippi River Valley were forecast to receive more than a half-inch of rain, according to the National Oceanic and Atmospheric Administration (NOAA). The Upper Mississippi Valley was also forecast to receive rain.
The U.S. Department of Agriculture (USDA) reported on Tuesday that corn planting progress on the Southern Plains reached 36 per cent complete. That’s ahead of the five-year average of 31 per cent.
The Renewable Fuels Association stated yesterday that U.S. ethanol producers will cut annual production by 2 billion gallons. Several states have required people to remain at home due to COVID-19. Plus, the Saudi Arabia/Russia crude oil price war has made ethanol production unprofitable.
Cordonnier maintained his estimate of Brazil’s corn production at 98.0 million tonnes.
WHEAT futures were mixed on Tuesday, with Chicago down a penny and Kansas City was up a cent, while Minneapolis saw higher gains.
The U.S. dollar gained more strength today and that generated smaller gains or losses for wheat prices.
There has been an increased global demand for flour, due to the pandemic. Consumer panic buying has left store shelves empty of flour, among a variety of other products.
Futures Prices as of March 24, 2020
Prices are in Canadian dollars per metric ton