By Phil Franz-Warkentin, Commodity News Service Canada
Winnipeg, May 6 (CNS Canada) – ICE Futures Canada canola contracts were up sharply on Friday, hitting fresh nine-month highs on the back of fund buying, weakness in the Canadian dollar, and a rally in the Chicago Board of Trade soy complex.
Mounting weather concerns in Western Canada contributed to the strength in canola, according to participants.
Warm and dry conditions may be allowing for a rapid start to spring seeding across the Prairies, but that lack of moisture will cause problems if it persists through the growing season. The early seeding pace was also said to be raising concerns over the possibility of crop damage if there is a late spring frost.
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Statistics Canada released its latest stocks data this morning, pegging Canadian canola stocks, as of March 31, at 7.49 million tonnes. That compares with 8.33 million tonnes at the same point the previous year, and was seen as a sign of the tightening supply situation.
About 17,955 canola contracts were traded on Friday, which compares with Thursday when 12,331 contracts changed hands.
Milling wheat, durum, and barley futures were all untraded, although prices were revised after the close.
SOYBEAN futures at the Chicago Board of Trade were up by 14 to 23 cents per bushel on Friday, recovering from early declines as ongoing production concerns in Argentina provided some support.
While harvest weather has improved in the South American country, the damage caused by excess moisture is still being calculated.
A move back above some major moving averages was also supportive for soybeans, with fund traders back on the buy side after liquidating some long positions on Thursday.
SOYOIL futures were up sharply on Friday.
SOYMEAL futures were up on Friday.
CORN futures in Chicago were up by three to four cents per bushel on Friday, finding some spillover support from the rally in soybeans.
Dry weather in Brazil added to the firmer tone in corn, as the lack of moisture cuts into the yield prospects there.
Solid export demand also underpinned the futures, with a fresh sale of 132,000 tonnes of US corn to Israel reported this morning.
On the other side, the good pace of spring seeding across the US Midwest did cap the gains to some extent.
WHEAT futures in Chicago were steady to up two cents per bushel on Friday, finding some spill over support from the gains in soybeans and corn.
Wheat was lacking any clear direction of its own today, with end of the week positioning the main feature as prices hovered right above nearby lows.
A crop tour of Kansas going on this week placed average yields in the major wheat growing state at 48.6 bushels per acre which was well above the 35.9 bushels last year.
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