By Jade Markus and Dave Sims, Commodity News Service Canada
Winnipeg, May 10 (CNS Canada) – ICE Futures Canada canola contracts were stronger on Tuesday, as spillover support propped up the market.
Chicago Board of Trade soybeans rallied on Tuesday as the United States Department of Agriculture (USDA) released its World Agricultural Supply and Demand Estimates.
July canola futures hit contract highs on Tuesday, which allowed fund buying to build on itself, which was technically supportive and allowed prices to move further.
Traders continue to work a weather premium into the market, as early forecasts for this growing season show dry conditions in Western Canada, which added to the advances.
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Higher prices tend to bring increased farmer-selling, which limited advances, along with investor profit-taking, on Tuesday.
About 55,451 canola contracts were traded on Tuesday, which compares with Monday when 20,155 contracts changed hands.
Milling wheat, durum, and barley futures were all untraded.
SOYBEAN futures shot up 27 to 57 cents Tuesday, in the wake of a USDA report that projected smaller US and global stockpiles than initially expected. The department pegged domestic soybean inventories at the end of the 2016/17 season at 305 million bushels, which compares with 400 million bushels in 2015/16.
Soybean production in Argentina has also been downgraded. The USDA expects the country to produce 56.5 million tonnes this year, which is less than the previous estimate of 59 million tonnes.
The USDA also revealed that China has purchased 40,000 metric tonnes of soyoil.
Soyoil finished 60 points higher with the rest of the soy complex.
SOYMEAL futures finished the day higher.
Corn futures on the Chicago Board of Trade advanced 10 to 12 cents a bushel Tuesday on new projections calling for smaller-than-anticipated domestic inventories. Stockpiles by the end of next August were pegged at 2.16 billion bushels which was slightly less than analysts’ guesses of 2.23 billion.
Brazil’s corn harvest could be less than expected, according to Global Commodity Analytics and Consulting. The company said hot and dry weather conditions are starting to make the crop shrivel.
The corn market took some strength from soybeans, a trader said.
Wheat futures on the Chicago Board of Trade finished four cents per bushel higher as the USDA predicted that US wheat production will fall in 2016/17.
India’s wheat production is expected to be seven million tonnes more than last year which was bearish for US wheat.
However, cheaper supplies from the Black Sea region cut into the gains.
– Morocco’s cereal crop is expected to be just 3.35 million tonnes, which is a 70 per cent drop from last year, according to a report.
– Southern Indiana is monitoring an outbreak of fusarium head blight that researchers at Purdue University fear could affect the wheat crop.
– Experts from the Inter-American Institute for Cooperation on Agriculture say it is very likely the La Nina weather phenomenon will form in the second half of the year which could have a significant impact on wheat growing areas in the northern hemisphere.
