By Phil Franz-Warkentin and Dave Sims, Commodity News Service Canada
Winnipeg, Jan. 29 – ICE Futures Canada canola contracts were down on Friday, as a firmer tone in the Canadian dollar and positioning against soybeans weighed on values.
Canola was looking overpriced compared to CBOT soybeans, after lagging its US counterpart to the downside on Thursday, according to a broker. While soybeans were higher on Friday, the trader said a rebalancing of the spreads between the two oilseeds weighed on canola on Friday.
Bearish chart signals contributed to the losses in canola, with some stops hit on the way down. However, support was uncovered to the downside and the market managed to settle well off its session lows.
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Steady farmer selling put some pressure on canola as well, although solid exporter and domestic crusher demand on the other side provided support.
About 29,146 canola contracts were traded on Friday, which compares with Thursday when 23,645 contracts changed hands. Spreading accounted for about 20,878 of the contracts traded.
Milling wheat, durum, and barley futures were all untraded, although wheat was revised higher after the close.
SOYBEAN futures posted gains of 13 to 14 cents per bushel Friday, essentially retracing their steps from yesterday after investors came to the conclusion that the market was oversold.
Technical buying also supported the market along with weather issues in South America.
On the other side, China’s decision to cancel an order of 395,000 tonnes of US soybeans continued to cast a bearish chill over prices.
Weekly soybean sales were also disappointing.
SOYOIL ended 19 points higher taking strength from crude oil.
SOYMEAL futures finished higher following soybeans.
CORN futures on the Chicago Board of Trade climbed six cents per bushel Friday due to healthy US weekly export sales.
Crude oil was also higher which contributed to the gains.
Many US farmers are reluctant sellers right now as they wait for prices to climb, according to a report.
However, steady sales from South America limited the advances.
WHEAT futures on the Chicago Board of Trade rose six to seven cents per bushel higher as traders covered short positions before the weekend.
Weekly US export sales were solid, which added to the gains.
However, ideas that Russia was going to adjust its export tax on wheat supplies have mostly been abandoned which was bearish for the market.
– China imported 2.97 million metric tonnes of wheat in 2015. Of that amoutg, Australia led the way with exports of 1.26 million tonnes, according to Chinese customs data.
– Vietnam is expected to bump up its wheat imports to 2.6 million tonnes in 2016. Last year, the country brought in 2.37 million tonnes.
