By Glen Hallick, MarketsFarm
WINNIPEG, April 24 (MarketsFarm) – ICE Futures canola contracts were stronger on Wednesday, as bids stepped away from contract lows.
Canola received support from a weaker Canadian dollar and the Principal Field Crop Acreage report released by Statistics Canada earlier today.
The Canadian dollar slipped to 74.15 U.S. cents by midafternoon Wednesday.
As expected, Statistics Canada has projected 21.3 million acres of canola this year. That’s down by 1.5 million acres from last year and 345,000 acres below the five-year average.
“This trimming of acreage is an important market factor, but ultimately production is decided by yield,” said Mike Jubinville of MarketsFarm Pro.
There were 36,896 contracts traded on Wednesday, which compares with Tuesday when 40,677 contracts changed hands.
SOYBEAN futures at the Chicago Board of Trade (CBOT) dropped on Wednesday due to pessimism towards United States/China trade talks resuming next week.
High-level negotiations have been scheduled to resume on April 30 in Beijing and continuing in Washington on May 8. Despite the news, the commodities market remained skeptical due to absence of anything tangible from previous rounds of talks.
A Calgary-based analyst stated the trade deal will no longer have the strong upswing for soybean prices as previously believed. Rather, there should a slight a bounce, but nothing more.
Also, concerns about large global supplies have remained.
The U.S. Department of Agriculture releases its weekly export sales report on Thursday. Market projections have been for 11 million to 27.6 million bushels sold for the week ended April 18.
CORN futures were weaker on Wednesday, caught up in the spillover from soybeans and wheat.
Market projections have called for export sales of 23.6 million to 43.3 million bushels.
The USDA indicated the agency will not collect data on damage to grain stored in bins in flooded areas of the country. However, Indigo Ag has estimated five million to 10 million bushels of corn and soybeans incurred flood damage, according to a report.
Ethanol production improved to about 1.05 million barrels for the week ended April 19.
WHEAT futures were weaker on Wednesday, following the release of the Principal Field Crop Acreage report by Statistics Canada.
Total wheat acres in Canada were projected to increase by about 940,000 acres this year to almost 25.7 million. Durum has been set to drop by about 1.2 million acres to five million. Spring wheat has increased by almost 2.1 million acres to 19.4 million. Winter wheat has remained pretty much the same at about 1.3 million acres.
With the increase of Canadian wheat acres, CBOT saw wheat prices tumble six to 10 cents on Wednesday. On top of that, U.S. wheat exports have been struggling in a highly competitive global market.
One saving grace has been the USDA projection for the fewest wheat acres planted in the country in a century.
Futures Prices as of April 24, 2019
Prices are in Canadian dollars per metric ton