By Phil Franz-Warkentin, MarketsFarm
Winnipeg, March 5 (MarketsFarm) – ICE Futures canola contracts were weaker on Tuesday, pressured by renewed concerns over declining demand from China.
China has reportedly blocked canola imports from Richardson International. Other Canadian exporters are also said to be running into hurdles making sales to China, amid the ongoing diplomatic dispute between the two countries.
Chart-based selling, bearish technical signals and spillover from the softer tone in Chicago Board of Trade soybeans also weighed on values.
However, rising crush margins and the recent weakness in the Canadian dollar provided some support. The solid crush margins, of roughly C$100 above the May futures contract, likely kept domestic processors in the market on a scale-down basis.
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About 21,864 canola contracts traded on Tuesday, which compares with Monday when 21,710 contracts changed hands. Spreading accounted for 14,008 of the contracts traded.
SOYBEAN futures settled with small losses on Tuesday.
While optimism that the United States and China may be getting closer to a trade deal remained somewhat supportive, the continued lack of any concrete developments had soybeans edging lower on the day.
The advancing Brazilian harvest also weighed on prices, although heavy rains in the country and reports of some issues getting soybeans into export position were a bit supportive.
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 firmer, taking some direction from wheat.
Corn remains relatively rangebound overall, waiting for developments on the trade front and on Friday’s USDA report.
WHEAT futures posted solid gains in most months, with the largest advances in Kansas City hard red winter wheat.
The Kansas winter wheat crop was rated 49 per cent good-to-excellent in the latest weekly report, which was down two points from the previous week.
Meanwhile, ratings showed some improvement in Oklahoma and Texas – at 53 per cent and 36 per cent good-to-excellent respectively.
Russia’s 2019 wheat crop was forecast at 75 million to 78 million tonnes by the country’s agriculture ministry, with 80 million a possibility with good weather.
