By Phil Franz-Warkentin and Jade Markus, Commodity News Service
Winnipeg, Feb. 22 (CNS Canada) – ICE Futures Canada canola contracts were stronger on Monday, as advances in crude oil and the US soy market kept fund traders on the buy side in the Canadian market.
Solid end user demand, together with a lack of significant farmer selling, was also supportive, said traders.
However, strength in the Canadian dollar did help slow the advances in canola. The currency was up by nearly half a cent relative to its US counterpart, trading back above 73 cents.
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About 38,835 canola contracts were traded on Monday, which compares with Friday when 44,456 contracts changed hands. Spreading was a major feature, accounting for about 30,160 of the contracts traded. The March/May spread moved to an inverse at one point during the session, as participants were busy exiting the front month.
Milling wheat, durum, and barley futures were all untraded.
SOYBEAN futures at the Chicago Board of Trade closed two to four cents per bushel stronger on Monday as crude oil futures gained ground.
Higher energy prices make it more likely processors will use soybeans for biodiesel, which is bullish.
Heavy rainfall in Argentina is putting the country’s crops at risk, which supported prices on Monday.
Investor short-covering was also a feature on Monday.
SOYOIL prices settled stronger on Monday, tracking Malaysian palm oil.
SOYMEAL closed higher on Monday, following soybean futures.
CORN futures closed two to four cents per bushel stronger on Monday, also supported by gains in crude oil futures.
Corn is an ingredient in ethanol production.
Many traders exited bearish bets on Monday, which pushed prices higher.
WHEAT closed one to three cents per bushel weaker on Monday, pressured by strength in the US dollar.
A stronger US dollar makes the country’s wheat less competitive, which is bearish.
Warm weather in the US limited losses, market watchers say, as it puts the country’s winter wheat crops at risk.
The warm weather could cause wheat plants to emerge sooner, and be hurt by frost.
– Russia shipped 1.5 million metric tonnes of wheat in January, according to reports on Monday.
– Analysts say Iraq is tendering for 50,000 metric tonnes of wheat of Australian, Canadian or US origin.
