By Glen Hallick, MarketsFarm
WINNIPEG, May 22 (MarketsFarm) – Intercontinental Exchange (ICE) Futures canola contracts were stronger on Wednesday, in a light volume of trading.
The July contract was up C$3.40 at C$445.80 per tonne. The November contract gained C$3.90 at C$458.60 per tonne.
Dry conditions across the Prairies has meant canola planting has been quick this spring. However, that dryness has become a cause for concern, which has resulted in slow germination and growth when combined with cooler temperatures.
For the markets, that has meant support for canola prices. Also providing support were limited farmer selling, and soybeans in the U.S. expected to produce lower yields this year.
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Strong competition from soy and palm oils, and the ongoing Canada/China dispute weighed on values, as were projections of record carryouts.
Agriculture and Agri-Food Canada has projected carryouts for canola to hit record levels in back-to-back years. In its May Outlook for Principal Field Crops, the department pegged a record carry out of 3.9 million tonnes for the current crop year. For the 2019/20 crop year, the department forecast a much larger record carryout of 5.3 million tonnes.
There were 15,274 contracts traded on Wednesday, which compares with Tuesday when 21,585 contracts changed hands. Spreading accounted for 8,116 contracts traded.
Settlement prices are in Canadian dollars per metric tonne.
Price Change
Canola Jul 445.80 up 3.40
Nov 458.60 up 3.90
Jan 464.10 up 3.60
Mar 469.40 up 3.40
SOYBEAN futures at the Chicago Board of Trade (CBOT) were stronger on Wednesday, correcting from Tuesday’s losses.
The gains also came ahead of the United States Department of Agriculture’s (USDA) weekly export sales report and an announcement from the Trump administration about a US$20 billion aid package for the country’s farmers.
Soybean growers are expected to receive US$2 per bushel in compensation for lower prices due to the 10-month old U.S./China trade war. A statement from the USDA said farmers should stick with their seeding plans, with changes only based on the markets.
As well, the USDA reported soybean planting has reached 19 per cent nation-wide as of May 19, far behind the average five-year pace of 47 per cent complete.
CORN futures were stronger on Wednesday due to continuing planting delays.
The USDA reported corn planting reached 49 per cent complete, well back from the five-year average of 80 per cent.
The U.S. aid package is expected to provide four cents per bushel for corn farmers.
Ethanol production in the U.S. was up for a third consecutive week, having reached 1.071 million barrels for the week ended May 17.
WHEAT futures were steady to lower on Wednesday, with a gain of three-quarters of a cent per bushel at Minneapolis. Chicago and Kansas City incurred losses of three to six cents per bushel.
Concerns over large domestic and global stocks, and below average exports weighed on values.
The Philippines purchased 45,000 tonnes of feed wheat from Australia.
Jordan’s tender for 120,000 tonnes of milling wheat went unfulfilled, but re-issued the same tender today with the closing date of May 28.
The consulting firm Coceral raised its estimate the European Union’s soft wheat crop by 500,000 tonnes to 140.3 million tonnes.
