By Phil Franz-Warkentin, Commodity News Service Canada
Winnipeg, Nov. 2 (CNS Canada) – ICE Futures Canada canola contracts were mostly lower on Thursday, seeing some consolidation as the market ran into chart resistance.
The Canadian dollar showed some strength relative to its
U.S. counterpart and moved back above 78 U.S. cents. Meanwhile, Chicago Board of Trade soyoil futures were steady to lower, and the resulting softness in crush margins accounted for some of the weakness in canola.
However, solid end user demand underneath the market provided support. A lack of significant farmer selling, with harvest operations wrapped up across most of the Prairies also underpinned the futures despite the fact that there are still a few areas of Alberta struggling to get the last of the crop off the field.
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About 20,091 canola contracts traded on Thursday, which compares with Wednesday when 19,679 contracts changed hands. Spreading accounted for 7,436 of the contracts traded.
Soybean futures at the Chicago Board of Trade moved higher on Thursday, as solid export demand provided support.
Weekly United States soybean export sales came in at just under two million tonnes, which topped pre-report trade expectations and helped underpin the futures.
Ideas that the U.S. Department of Agriculture will lower its U.S. soybean production estimate in a report out next week also kept the market supported.
However, improving production ideas out of Brazil kept a lid on the market.
Corn was up on the day, seeing some spillover strength from the gains in soybeans and wheat.
Weekly U.S. corn export sales came in at about 811,000 tonnes, which were at the low end of trade expectations.
Rising yield projections for the U.S. corn crop ahead of next week’s USDA report also put some pressure on values. Private forecasters Informa Economics released their own estimates, pegging average U.S. corn yields at 173.4 bushels per acre. That would be up by about one and a half bushels per acre from the USDA’s last estimate.
Wheat was higher, seeing a short-covering correction off of the contract lows hit earlier this week.
However, there was little fresh supportive fundamental news behind the move. Weekly U.S. wheat sales of about 350,000 tonnes were in line with expectations, but not all that exciting as U.S. wheat continues to face stiff competition in the global market.
