By Glen Hallick, MarketsFarm
WINNIPEG, April 9 (MarketsFarm) – ICE Futures canola contracts were steady at the end of trading on Tuesday, with small gains for the front months and small losses for the November and January contracts.
The May canola contract gained 80 cents to close at C$455.30 per tonne.
Weighing on values were the large South American soybean harvest and expectations that U.S. farmers will switch from corn to planting soybeans, due to wet conditions.
Prairie road bans and farmer reluctance to sell combined to provide some support for prices, along with the expectation that fewer canola acres will be planted in 2019.
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For the markets and Canadian farmers, the weather has yet to become a major factor at this point, but that is expected to change by the end of April.
The threat of flooding in Manitoba’s Red River Valley was downgraded on Tuesday. While the Red River will still rise quite a bit, forecasters are now expecting levels similar to those in 2011.
In an email to MarketsFarm, a spokesperson for Agriculture Canada said canola remains banned by China, and the country has not targeted any other grains or oilseeds. However, others in the ag industry have stated there is a great deal of nervousness in the markets that China could move against other imports from Canada down the road.
The U.S. Department of Agriculture’s monthly World Supply and Demand Estimates, released earlier today, had little if any, effect on canola bids. The report noted that global oilseed exports fell by 1 million tonnes, to 177.1 million tonnes, largely on China’s ban on Canadian canola.
With the U.S. not removing tariffs on Canadian steel and aluminum products, the Canadian Ambassador to the U.S. said Canada could impose tariffs on U.S. goods, including ag products.
The Canadian dollar was down by midafternoon on Tuesday, at 75.04 U.S. cents.
There were 22,724 contracts traded on Tuesday, which compares with Monday when approximately 15,400 contracts changed hands.
SOYBEAN futures at the Chicago Board of Trade were unchanged on Tuesday, following the United States Department of Agriculture’s World Agriculture Supply and Demand Estimates (WASDE) released earlier today.
The USDA projected ending stocks for soybeans down by 120,000 tonnes to 24.37 million tonnes.
Flooding in the Midwest and Northern Plains will likely see more soybeans this year as farmers move away from corn.
The USDA bumped global ending stocks by 190,000 tonnes to 107.36 million tonnes.
CORN futures were unchanged on Tuesday.
The WASDE report stated that U.S. corn exports were down largely due to increased competition from Brazil, Argentina, Ukraine and the European Union. The U.S. is expected to sell 58.42 million tonnes of corn in 2018/19, a drop of 1.91 million tonnes from the March estimate.
WHEAT futures were weaker on Tuesday, with small losses at Minneapolis and larger losses seen with Kansas City and Chicago.
Exports of U.S. Hard Red Winter Winter were up, but were well offset by declines in exports of Hard Red Spring Wheat, White and Durum. While the U.S. sold 26.26 million tonnes of wheat in the 2018/19 by March, projected exports were pegged to reach 25.72 million tonnes in April. Ending stocks are set to climb by 860,000 tonnes to 29.58 million tonnes.
