By Jade Markus and Dave Sims, Commodity News Service Canada
Winnipeg, May 13 (CNS Canada) – ICE Futures Canada canola contracts were higher on Thursday, rebounding after earlier losses, and gathering strength from a lower loonie.
Canola was able to gain back ground ahead of the weekend, as sharp declines brought the market near support levels.
The Canadian dollar lost ground against its US counterpart, as weak domestic data and losses in crude oil pressured the commodity-linked currency.
A weaker loonie makes Canada’s commodities more competitive internationally, which is bullish.
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Dry weather in pockets of the Prairies, most notably Alberta, continued to keep the market underpinned.
Losses in Malaysian palm oil and Chicago Board of Trade soybeans capped advances on Friday.
CBOT soybeans felt pressure from profit-taking, and the expectation that US producers could seed more soy this year.
About 16,853 canola contracts were traded on Friday, which compares with Thursday when 37,866 contracts changed hands.
Milling wheat, durum and barley futures were all untraded and unchanged.
SOYBEAN futures suffered modest losses of 5 to 7 cents per bushel to end the week as traders booked profits.
Dry weather is forecast for the US Midwest, which should help farmers complete field-work. Analysts are also speculating that two to three million acres of corn could be switched out in favour of soybeans this year.
The next two weeks are expected to be relatively warm and rain-free in Argentina, which should help dry out water-logged soybean fields and allow farmers to get some harvesting done.
However, the USDA announced a sale of 140,000 tonnes of soybeans to an unknown buyer, which limited losses.
Soyoil fell 7 points lower to end the week.
SOYMEAL futures finished lower as reports indicate Asian buyers are starting to shy away from buying due to high prices.
Corn futures on the Chicago Board of Trade finished 1 to 2 cents per bushel higher Thursday on technical buying. The front-month July contract found support at the US$3.90 per bushel mark.
Speculation that US farmers, particularly in the eastern corn belt, will shed corn acres in favour of soybeans underpinned the market.
However, some rain in Brazil was bearish as it is expected to partially alleviate concerns over dryness.
Wheat futures on the Chicago Board of Trade finished 6 cents per bushel higher as traders covered shorts ahead of the weekend.
The forecast for the wheat crop in Russia was raised to 61.1 million tonnes by SovEcon. The agency’s previous estimate was just 59 million tonnes.
Rain is forecast in the US Southern Plains which was bearish for the market.
– Drought in South Africa has lowered country’s wheat crop output by 18 per cent, according to a report.
– 87 per cent of the French soft wheat crop is reported in good condition which is about the same as the previous week.
