By Phil Franz-Warkentin, Commodity News Service Canada
Winnipeg, Aug. 16 (CNS Canada) – ICE Futures canola contracts were stronger on Thursday, hitting their best levels in a week as a rally in Chicago Board of Trade soybeans provided support.
China is reportedly sending a delegation to the United States later this month to negotiate possible solutions to the ongoing trade war between the two countries. While a deal is far from being signed, the news was enough to send soybeans climbing higher, which pulled canola up as well.
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Uncertainty over Canadian canola yields, after heat and dryness caused stress during the growing season, was also supportive. However, harvest operations will soon be picking up and many anecdotal reports still point to average yields overall.
About 12,336 canola contracts traded, which compares with Wednesday when 6,787 contracts changed hands. Spreading accounted for 4,504 of the contracts traded.
SOYBEAN futures at the Chicago Board of Trade were up sharply on Thursday, with optimism that China and the United States could be moving towards a solution to their ongoing trade war providing the catalyst for the rally.
A Chinese delegation is set to visit Washington, D.C. for low-level talks later this month.
Weekly export sales reported by the U.S. Department of Agriculture included 571,000 tonnes of new crop business, but old crop business of only 130,000 tonnes as some sales were cancelled and rolled into the new crop year.
The USDA also announced a private sale of 154,000 tonnes of soybeans to Mexico.
Good crop conditions across most of the Midwest helped keep a lid on the upside.
CORN futures moved up in sympathy with soybeans. Weekly U.S. corn export sales came in at about 1.3 million tonnes of old and new crop business combined, which topped trade expectations.
However, just as in beans, relatively favourable Midwestern crop conditions put some pressure on values.
WHEAT futures were all higher, as weekly U.S. wheat export sales hit their best level of the marketing year-to-date, at 803,000 tonnes. The USDA also reported extra business of 200,000 tonnes to Iraq this morning.
Production concerns in a number of wheat growing regions of the world also remained supportive.
However, the advancing North American spring wheat harvest and improving moisture conditions in the U.S. Plains put some pressure on values.
