By Phil Franz-Warkentin, MarketsFarm
WINNIPEG, Nov. 10 (MarketsFarm) – The ICE Futures canola market was stronger on Wednesday, hitting fresh contract highs as tight supplies, solid demand, bullish technical signals and spillover from outside markets all provided support.
End users looking to secure coverage and speculators adding to their large net long positions were both on the buy side, with a lack of significant selling pressure to limit the gains.
Chicago Board of Trade soyoil futures posted solid advances. Malaysian palm oil and European rapeseed futures were also up overnight.
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The canola market will be closed Thursday for Remembrance Day, with positioning ahead of the holiday likely behind some of the activity.
About 24,721 canola contracts traded on Wednesday, which compares with Tuesday when 19,925 contracts changed hands. Spreading accounted for 19,118 of the contracts traded.
SOYBEAN futures at the Chicago Board of Trade were stronger on Wednesday, seeing follow-through buying interest after Tuesday’s bullish supply/demand report from the United States Department of Agriculture.
The USDA surprised traders by lowering their estimate for average U.S. soybean yields this year, which remained supportive for the futures today. Tighter than expected world and U.S. ending stocks projections also underpinned the market.
Chinese soybean futures climbed higher in overnight trade – which lent some support to the U.S. market as well. However, demand from the country for U.S. beans has been slipping lately.
The USDA announced a private export sale of 22,000 tonnes of soyoil to unknown destinations this morning.
CORN posted solid gains, finding some spillover support from a rally in wheat. Corn also lagged soybeans to the upside yesterday, and adjustments in the spreads between the two commodities favoured corn on Wednesday.
The U.S. corn harvest is nearing completion, but cool wet conditions in the forecasts may cause delays for some of the remaining fields.
Weekly ethanol data showed production of the renewable fuel slipped slightly, off of its recently-hit record highs, but still solid at 1.039 million barrels per day.
WHEAT was up across the board, with all three markets posting double-digit gains.
News that Russia was planning on implementing export quotas from January through June was supportive, as that should open the door for more North American sales.
The tightening world wheat stocks forecast by the USDA yesterday also remained supportive. World wheat ending stocks for the current marketing year were forecast at 275.8 million tonnes, which was below trade guesses and compares with the 288 million tonne carryout from the previous year.
