By Phil Franz-Warkentin, Commodity News Service Canada
Winnipeg, Nov. 3 (CNS Canada) – ICE Futures Canada canola contracts were down on Friday, taking back most of the gains posted over the course of the week as speculative profit-taking weighed on values.
Strength in the Canadian dollar and losses in the Chicago Board of Trade soy complex contributed to the declines in canola, according to participants.
Farmer selling that was encouraged by the recent move to four-month highs in canola also weighed on values.
However, solid end-user demand underneath the market helped limit the losses. Concerns over unharvested fields in parts of Alberta also kept some caution in the futures, although the latest report out of the province showed that only 2.5 per cent of the canola crop was still unharvested as of October 31.
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About 14,566 canola contracts traded on Friday, which compares with Thursday when 20,091 contracts changed hands. Spreading accounted for 4,626 of the contracts traded.
Soybean futures at the Chicago Board of Trade moved lower on Friday. Traders took profits ahead of the weekend in the absence of any fresh supportive news to sustain Thursday’s rally
Relatively favourable South American crop prospects contributed to the softer tone, although production out of Brazil and Argentina is still expected to be down on the year.
The USDA releases updated production estimates next week, and pre-report guesses are generally calling for a slight decline in average U.S. soybean yields compared to the October report. However, those ideas may already be priced into the futures.
Corn posted small losses, taking some direction from the downturn in soybeans. However, corn remains stuck in a rather flat and narrow trading range.
Seasonal harvest pressure and ideas that average U.S. corn yields will be revised higher by about 1 to 2 bushels per acre in next week’s report added to the softer tone.
However, good export demand recently provided underlying support with yesterday’s large sales to Mexico followed by more business to Mexico and South Korea on Friday.
Wheat was narrowly mixed on the day, seeing some consolidation after Thursday’s bounce off of nearby lows.
However, ample world supplies and only soft demand for U.S. wheat in the global export market kept the market under pressure.
The Minneapolis futures did manage to see some independent strength, amid ongoing concerns over tightening supplies of higher protein wheat.
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