By Glen Hallick, MarketsFarm
WINNIPEG, Oct. 29 (MarketsFarm) – Intercontinental Exchange (ICE) Futures canola contracts were steady to lower on Tuesday, regaining most of the strength it lost earlier in the session.
A trader explained that speculators have been behind the recent losses in canola, pushing bids down despite support from Chicago soyoil.
Also, he noted canola has remained cheap, with there being few strong purchasers in the market and the desire of commercial buyers to see prices stay low.
The Prairie forecast will see snow and rain fall across most of the region during the week, further hampering a slow harvest. Daytime temperatures will improve slightly, going from a little below freezing to a few degrees above.
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The Canadian dollar was weaker at mid-afternoon Tuesday at 76.37 U.S. cents, after closing Monday at 76.59.
There were 24,382 contracts traded on Tuesday, which compares with Monday when 25,895 contracts changed hands. Spreading accounted for 15,044 contracts traded.
Settlement prices are in Canadian dollars per metric tonne.
Price Change
Canola Nov 451.40 dn 1.00
Jan 460.70 dn 0.40
Mar 470.00 dn 0.40
May 478.50 unchanged
SOYBEAN futures at the Chicago Board of Trade (CBOT) were lower on Tuesday, as there has been nothing concrete regarding the tentative partial trade deal between the United States and China.
Any remaining positive vibe from that deal has largely run out. Traders have become skeptical due to the lack of any solid, tangible action by either country.
The United States Department of Agriculture (USDA) reported in its weekly crop progress report that 62 per cent of soybeans have been harvested as of Oct. 27. That’s a gain of 16 points from the previous week, but 16 behind the five-year average. Also, it’s slightly under market expectations and seven points back of this time last year.
Leaves dropping off of soybeans reached 97 per cent complete, which was a gain of three from the previous week, but two points behind the average. This time last year, leaves dropping were at 100 per cent complete.
The U.S. continues to be plagued with cold, wet conditions in most growing regions. For this week, there are winter storm watches from the Rockies to Missouri. The eastern Corn Belt has been dealing with wet conditions with more rain in the forecast. A second cold snap could produce a killing frost.
The U.S. Federal Reserve is scheduled to announce its course of action for its benchmark interest rate on Wednesday. The markets widely believe the Fed will cut its rate by another quarter point.
Dr. Michael Cordonnier of Soybean and Corn Advisor kept his estimate of U.S. soybean production at 46.0 bushels per acre for 94.438 million tonnes. Also unchanged were his estimates for Brazil and Argentina soybean production. For Brazil, Cordonnier pegged it at 124.0 million tonnes and Argentina at 57.0 million tonnes.
CORN futures were higher on Tuesday, but there was a lack of fresh news to influence prices either way.
In the crop progress report, corn conditions were up two points from the previous week at 58 per cent good to excellent, and on par with this time last year. Matured corn reached 93 per cent complete, which was up seven from last week but six behind the average. Harvested corn rose 11 points to 41 per cent complete, but that’s 20 points off of the pace.
The U.S. Congress is scheduled to meet with representatives and lobbyists from oil companies and ethanol proponents on Tuesday afternoon. Congress is to examine the Energy Protection Agency’s latest requirements that make for ethanol exemptions granted by the Trump Administration.
Cordonnier froze his estimate of U.S. corn production at 162.0 bushels per acre for 354.891 million tonnes. For Brazil, he left his estimate at 103.0 million tonnes and Argentina’s remained at 50.0 million tonnes.
WHEAT futures traded either side of steady on Tuesday, with Chicago and Minneapolis bids slightly lower while Kansas City bids were slightly higher.
The U.S. lost out on a sale of 235,000 tonnes of wheat to Egypt, because it’s wheat is uncompetitive. Egypt will purchase 115,000 tonnes from Ukraine, 60,000 from France and another 60,000 from Romania.
There’s speculation that protein could be at a premium after the snow in North Dakota and the Canadian Prairies.
In the USDA’s progress report, winter wheat planted hit 85 per cent complete after a gain of eight points from the previous week. Planting was three back of the five-year average. About 63 per cent of winter wheat has emerged, up 10 points from the previous week and only one off of the pace. Winter wheat conditions were 56 per cent good to excellent, which was three points better than in this time last year.
Vietnam reportedly bought 2 million tonnes of wheat from Russia. Vietnam previously stopped buying from Russia due to thistles. The issue was said to be rectified, according to a report.
