By Phil Franz-Warkentin, MarketsFarm
WINNIPEG, July 29 (MarketsFarm) – The ICE Futures canola market was stronger on Wednesday, climbing above nearby resistance as fund traders added to long positions and covered previous shorts.
Solid export demand, especially from Europe, added to the gains with canola exports to the European Union running about four-times ahead of the year ago level.
Overnight gains in Malaysian palm oil and a gains in Chicago Board of Trade soyoil also underpinned canola.
However, soybeans were down in Chicago, while the Canadian dollar held steady.
Generally favourable Canadian crop conditions kept a lid on the upside, with the harvest only a few weeks away.
About 21,104 canola contracts traded on Wednesday, which compares with Tuesday when 14,638 contracts changed hands. Spreading accounted for 11,454 of the contracts traded.
Settlement prices are in Canadian dollars per metric tonne.
Canola Nov 491.20 up 3.60
Jan 497.80 up 3.30
Mar 501.40 up 2.20
May 503.60 up 1.60
SOYBEAN futures at the Chicago Board of Trade were weaker on Wednesday, as the market continued to react to the improving United States crop conditions reported earlier in the week.
With 72 per cent of the country’s crop in good to excellent condition, many analysts are raising their yield estimates for the crop with some as high as 52 bushels per acre. That compares with the current U.S. Department of Agriculture forecast of 49.8 bushels per acre.
Midwestern forecasts call for reasonably favourable weather over the next week.
Expectations for another large crop in Brazil also weighed on values.
CORN futures also remained pressured by the good U.S. crop weather.
Weekly U.S. ethanol data showed average production of 958,000 barrels per day, which was up by 50,000 from the previous week. Stocks of the renewable fuel were also increasing
Brazil’s second corn harvest is running a bit behind normal, providing some support.
WHEAT futures were higher on Wednesday, correcting after posting large losses the previous two days.
Declining production estimates out of parts of Europe contributed to the firmer tone in wheat.
Good rains in Australia should improve crop prospects there, while the latest estimates out of Russia were also pointing to a larger crop on the year.
Futures Prices as of July 29, 2020
Prices are in Canadian dollars per metric ton