By Phil Franz-Warkentin, Commodity News Service Canada
Winnipeg, Jan. 29 (CNS Canada) – ICE Futures Canada canola contracts were stronger on Monday, taking some direction from the Chicago Board of Trade soy complex.
With little fresh news of its own canola largely tracked the outside markets, with the strength in soybeans and a weaker tone in the Canadian dollar lending some support, according to participants.
Speculators covering short positions were behind much of the buying interest, with only routine commercial business taking place in the background.
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However, ample old crop supplies and mounting expectations for record canola seedings this spring kept a lid on the upside.
About 21,304 canola contracts traded on Monday, which compares with Friday when 11,282 contracts changed hands. Spreading accounted for 16,748 of the contracts traded.
Soybean futures at the Chicago Board of Trade moved higher on Monday, with the South American weather situation at the forefront of the market. Forecasts are now calling for hotter temperatures in dry areas of Argentina.
Advances in soymeal were also supportive for soybeans in general, with the strength there due to lower than normal protein levels in the United States crop.
Chart-based buying contributed to the advances, as beans recovered after Friday’s declines.
However, large world supplies tempered the upside.
Corn futures settled with small gains, as solid export demand and the South American weather uncertainty lent some support.
Speculative short-covering was another feature in corn, as fund traders continued buying back some of their large net short positions.
U.S. wheat futures were mixed, with gains in the Chicago and Kansas City contracts and losses in Minneapolis spring wheat.
Persistent dryness concerns across the U.S. winter wheat belt kept a bid in the market, with advances above nearby chart resistance levels bringing in some additional buying interest.
Recent weakness in the U.S. dollar index also remained supportive.
