By Phil Franz-Warkentin, Commodity News Service Canada
Winnipeg, Jan. 8 (CNS Canada) – ICE Futures canola contracts settled mixed on Tuesday, with gains in the most active contracts as early selling pressure subsided by the close.
Losses in the Chicago Board of Trade soy complex accounted some spillover selling pressure throughout the day in canola, with the Canadian dollar holding steady after its recent rally.
A lack of significant end user demand and ample visible supplies also weighed on values, according to participants.
However, canola managed to find some support late in the day, with chart-based short-covering and positioning relative to soybeans providing some support.
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News that China had approved two varieties of genetically modified canola for import was also supportive, as the approval opens the door for the traits to be grown in the Canadian Prairies.
About 8,645 canola contracts traded on Tuesday, which compares with Monday when 14,696 contracts changed hands. Spreading accounted for 3,252 of the contracts traded.
SOYBEAN futures at the Chicago Board of Trade were lower on Tuesday, with chart-based profit-taking accounting for some of the selling pressure.
While optimism over trade talks with China and possible fresh sales remained supportive, any confirmation of fresh business was lacking with the United States government still shutdown mode.
Updated supply/demand data was due to be released on Friday, Jan. 11, but the U.S. Department of Agriculture reports are now delayed indefinitely.
Weather concerns in parts of Brazil were somewhat supportive for soybeans, while increased European demand for U.S. soybeans also underpinned the futures.
Brazil’s CONAB will release its own estimates on the size of that country’s crops on Thursday.
CORN futures were softer on the day, following soybeans. Recent weakness in the ethanol sector also weighed on the energy-linked grain.
Uncertainty over the trade negotiations with China kept some caution in the market, although today’s news did include reports that China had approved a genetically modified variety of corn for import. Two canola traits and two soybean traits were also approved.
WHEAT futures were mixed, with losses in Minneapolis spring wheat and gains in the winter wheats. U.S. wheat is thought to be looking more attractively priced on the global export market, which was slightly supportive.
Average trade guesses expect U.S. winter wheat seedings this fall were down from the year ago. However, the USDA’s report that had been set for release on Friday is delayed due to the shutdown.
