By Phil Franz-Warkentin, MarketsFarm
Winnipeg, May 16 (MarketsFarm) – ICE Futures canola contracts were stronger on Thursday, hitting their best levels in three weeks as gains in the Chicago Board of Trade soy complex provided support and speculators covered short positions.
The need to keep some weather premiums in place as canola seeding progresses across the Canadian Prairies was somewhat supportive, with many areas on the dry side and soon in need of moisture.
Solid crush margins and a softer tone in the Canadian dollar were also supportive.
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However, ongoing uncertainty over Chinese demand kept some caution in the market, with trade tensions between Canada and China heightened on news that China has officially arrested two Canadians who had been held in custody since December.
About 17,137 canola contracts traded on Thursday, which compares with Wednesday when 21,128 contracts changed hands. Spreading accounted for 9,638 of the contracts trade.
SOYBEAN futures at the Chicago Board of Trade were stronger on Thursday, as speculative short-covering continued to provide support.
Weekly export sales of about 675,000 tonnes (old and new crop combined) came in at the higher end of trade expectations which provided some support.
Gains in corn were also supportive, although beans lagged to the upside as the weather concerns boosting corn will likely result in more soybeans seeded this spring than originally expected.
Uncertainty over trade talks with China also remained a bearish influence in the background.
CORN futures were stronger, as the slow Midwestern seeding pace remained supportive. The seven-day forecasts are calling for heavy rainfall across much of the Corn Belt, which should cause more delays and likely lead to lost acres at this point.
Solid weekly old crop export sales of 550,000 tonnes were also supportive, although new crop business was poor at only about 80,000 tonnes.
WHEAT futures posted solid gains, with good weekly export sales accounting for some of the buying interest.
The U.S. Department of Agriculture reported old crop business of just over 100,000 tonnes and an additional 419,000 tonnes of new crop wheat sales.
The wet weather delaying spring corn seeding was also starting to cause concerns over quality losses and harvest delays for winter wheat in some areas.
However, ample world wheat supplies kept a lid on the upside.
