By Phil Franz-Warkentin, MarketsFarm
Winnipeg, March 7 (MarketsFarm) – ICE Futures canola contracts were stronger at Thursday’s close, as speculative short-covering came forward following earlier losses.
Canola dropped to fresh contract lows in early activity, but managed to turn higher amid ideas the market was starting to look oversold.
Solid crush margins, gains in Chicago Board of Trade soybeans and recent weakness in the Canadian dollar also provided some support.
However, traders cautioned that any corrective bounce would likely be short-lived as the underlying fundamentals and techncials remain bearish.
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Trade issues with China, losses in CBOT soyoil, large unpriced old-crop supplies in the countryside and a bearish outlook for many other new-crop seeding options all weighed on values.
About 19,750 canola contracts traded on Thursday, which compares with Wednesday when 17,518 contracts changed hands. Spreading accounted for 12,872 of the contracts traded.
SOYBEAN futures at the Chicago Board of Trade held steady on Thursday, as traders squared positions ahead of the United States Department of Agriculture’s monthly supply/demand report on Friday.
Weekly U.S. soybean export sales came in well below market expectations at only 311,000 tonnes of old crop business and 72,000 tonnes for new crop. Many traders had expected the sales to top a million tonnes.
Continued uncertainty over China/US trade talks also kept some caution in the market. However, cheaper prices were thought to be bringing in some buying interest, with reports that China bought 500,000 tonnes of U.S. soybeans.
The advancing Brazilian harvest kept some pressure on values, with weakness in the country’s currency also encouraging farmer sales.
CORN futures fell in sympathy with wheat, despite solid export demand.
Weekly U.S. corn export sales came in at just under a million tonnes of old crop business and 280,000 tonnes for delivery in 2019/20.
However, bearish technical signals and spillover from declines in wheat weighed on prices. Concerns over African swine fever in China also put some pressure on the feed grain.
WHEAT futures were steady to lower, with a firm tone in Minneapolis spring wheat and losses in the winter wheats.
Weekly U.S. wheat export sales of just over 800,000 tonnes of old and new crop business combined top trade expectations and provided some support.
However, the U.S. continues to face stiff completion on the global market, and falling prices in Europe and Russia kept U.S. bids under pressure in an effort to maintain some demand.
