By Phil Franz-Warkentin, Commodity News Service Canada
Winnipeg, Nov. 27 (CNS Canada) – ICE Futures Canada canola contracts dropped to their lowest levels in a month on Monday, taking some direction from the losses in Chicago Board of Trade soyoil and other international vegetable oil markets.
Bearish technical signals contributed to the declines, with some fund long liquidation triggered as values moved below some key moving averages. Farmer hedges were another bearish influence, as year-end bills will soon be coming due.
Scale-down end user demand provided some underlying support. Uncertainty over South American soybean production and the resulting strength in CBOT soybeans also helped temper the declines.
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About 20,851 canola contracts traded on Monday, which compares with Friday when 23,558 contracts changed hands. Spreading accounted for 10,864 of the contracts traded.
Soybean futures at the Chicago Board of Trade posted small gains on Monday, with persistent South American production uncertainty behind some of the strength.
The nearby January contract briefly moved above the psychological US$10 per bushel level, but ran into some resistance.
Soyoil was down on the day, which tempered the upside in beans as the vegetable oil markets continue to react to last week’s move by India to raise import tariffs on vegetable oil.
Weekly U.S. soybean export inspections of about 1.5 million tonnes came in at the low end of trade expectations.
U.S. wheat markets were down on the day, hitting fresh contract lows in the Chicago and Kansas City contracts.
Weekly US wheat export inspections of 344,000 tonnes were in line with trade guesses, but still relatively small as the US continues to miss out on export opportunities.
The Minneapolis futures posted the largest losses of the day, but spring wheat was still well above its contract lows with tight supplies of higher protein wheat worldwide lending some support.
The losses in wheat put some spillover pressure on corn, although the corn market was lacking any fresh news of its own.
The US corn harvest should be pretty much wrapped up in today’s USDA crop report.
