By Phil Franz-Warkentin, MarketsFarm
WINNIPEG, April 20 (MarketsFarm) – The ICE Futures canola market was stronger on Tuesday, hitting fresh contract highs as the nearby May contract moved up its daily C$30 per tonne limit.
Bullish technical signals had fund traders adding to their large long positions, with end users also getting in on the buy side as they looked to book some coverage before prices go higher still.
Tight old crop supplies and dryness concerns for the new crop remained supportive from a fundamental standpoint, according to participants.
A rally in the Chicago Board of Trade soy complex and weakness in the Canadian dollar was also supportive on Tuesday.
Selling pressure on the other side only came forward on a scale-up basis, as farmers appeared content to watch the market move higher.
About 28,465 canola contracts traded on Tuesday, which compares with Monday when 22,174 contracts changed hands. Spreading accounted for 13,354 of the contracts traded.
SOYBEAN futures at the Chicago Board of Trade were up sharply on Tuesday, hitting fresh highs as tight old crop supplies helped drive the speculative rally. Soyoil led the soy complex to the upside, with advances in world vegetable oil markets providing support.
The United States soybean crop was three per cent seeded as of this past Sunday, according to the latest U.S. Department of Agriculture crop progress report, which was in line with trade expectations.
Forecasts calling for cold temperatures and a winter storm across a large section of the U.S. Midwest over the next few days could lead to some intended corn area go into soybeans instead, which tempered the advances to some extent.
CORN also set fresh contract highs, boosted by cold Midwestern weather, solid export demand, and bullish technical signals.
The USDA announced private export sales of 114,000 tonnes of corn to Mexico this morning.
The U.S. corn crop was eight per cent seeded in the latest weekly crop report. That was slightly below trade guesses, but in line with the five year average.
Cold Midwestern temperatures were being followed closely, as the weather will slow emergence and could cut into the yield prospects. However, there is still a long growing season ahead.
WHEAT futures were higher, as the fund money driving soybeans and corn higher also spilled into the wheat market.
Cold U.S. temperatures and dryness in the North American spring wheat areas underpinned wheat today.
The U.S. winter wheat crop was rated 53 per cent good to excellent. That was steady on the week, but four points off last year’s level at this time
Spring wheat was 19 per cent seeded in the country, up from the 12 per cent average.
Futures Prices as of April 20, 2021
Prices are in Canadian dollars per metric ton