By Phil Franz-Warkentin, MarketsFarm
Winnipeg, March 6 (MarketsFarm) – ICE Futures canola contracts were weaker on Thursday, with ongoing worries over Chinese trade restrictions accounting for much of the selling pressure.
China is one of the largest buyers of Canadian canola and products, and traders remained concerned that diplomatic tensions between the two countries will lead to more lost sales after yesterday’s news that Richardson International had been blocked from the Chinese market.
Bearish chart signals and spillover from declines in Chicago Board of Trade soybeans also weighed on values.
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However, the Canadian dollar was also weaker, losing roughly half of a cent relative to its United States counterpart. The softer currency provided some underlying support for canola, as crush margins improved.
About 17,518 canola contracts traded on Wednesday, which compares with Tuesday when 21,864 contracts changed hands. Spreading accounted for 9,386 of the contracts traded.
SOYBEAN futures at the Chicago Board of Trade were weaker on Wednesday, as the lack of any significant progress on trade talks between the United States and China weighed on values.
The advancing Brazilian harvest added to the softer tone. However, delays moving recently harvested beans from the countryside to export positions, due to recent rainfall and washed out roads, provided some support.
The U.S. Department of Agriculture’s monthly supply/demand report will be released on Friday, and pre-report positioning accounted for some activity.
CORN futures were weaker, taking some direction from soybeans and wheat.
Mexico is considering placing tariffs on U.S. corn imports in retaliation for U.S. tariffs on Mexican steel.
Expectations for a late start to spring seeding across parts of the U.S. Midwest, due to heavy snow this winter, provided some support.
WHEAT futures fell with speculative selling on Wednesday.
Rising production estimates out of Russia and Europe were bearish, while U.S. carryout stocks are also expected to be up in Friday’s USDA report.
