By Phil Franz-Warkentin, Commodity News Service Canada
Winnipeg, May 19 (CNS Canada) – ICE Futures Canada canola contracts were stronger on Friday, taking some direction from the advances in Chicago Board of Trade soybeans and soyoil.
Tightening Canadian supplies and solid end user demand added to the firmer tone, according to participants.
The Canadian Grain Commission reported visible canola supplies in commercial hands at only 854,500 tonnes, as of May 14. That was down sharply from the previous week and the first time stocks dipped below the million tonne mark since September 2016.
Read Also
ICE Midday: Canola still in free fall
Glacier FarmMedia – Canola futures on the Intercontinental Exchange took another sharp drop on Friday as Thursday’s report from Statistics Canada…
However, strength in the Canadian dollar, which was up by roughly half a cent relative to its US counterpart, put some pressure on values.
Improving Canadian weather conditions and ideas farmers should be able to make some good seeding progress in many areas over the next few days, also helped temper the gains in canola.
Canadian markets will be closed Monday, May 22, for Victoria Day and positioning ahead of the long weekend accounted for some of the activity.
About 17,775 canola contracts traded on Friday, which compares with Thursday when 16,955 contracts changed hands. Spreading accounted for 5,342 of the contracts traded.
Milling wheat, durum, and barley were all untraded, although prices were revised after the close.
SOYBEAN futures at the Chicago Board of Trade up by five to nine cents per bushel on Friday, as the market saw a modest correction to end the week following Thursday’s sharp declines.
Broad-based weakness in the US dollar index provided underlying support, as the declining currency makes US soybeans more attractive to international buyers.
Forecasts calling for harvest-delaying rains in Argentina added to the firmer tone in the US futures, according to participants.
However, the latest production estimates out of the South American country remain large overall.
Expectations for increased Brazilian exports, as that country’s own weakening currency draws in more international demand, also put some pressure on US values.
SOYOIL futures were stronger on Friday, with gains in crude oil providing some support for the world vegetable oil markets as well.
SOYMEAL futures were narrowly mixed on Friday, as spreading against soyoil weighed on values.
CORN futures in Chicago were up by five to six cents per bushel on Friday.
Speculative short-covering was a supportive feature in corn ahead of the weekend, with rains in some parts of the Midwest likely causing seeding delays.
Declining grain production forecasts out of the European Union were also supportive, as a mix of dryness and frosts reportedly cut into the yield prospects there.
WHEAT futures in Chicago settled eight to nine cents per bushel higher on Friday, with speculative short-covering a feature.
Declining European production prospects and weather concerns in parts of the US southern Plains were also supportive.
France’s Strategie Grains lowered its production forecast for European wheat to 142.7 million tonnes, which was down 1.1 million tonnes from an earlier estimate.
