By Dave Sims, Commodity News Service Canada
Winnipeg, July 31 (CNS Canada) – Canola contracts on the ICE Futures platform posted solid gains on Tuesday, following a spike in the value of Chicago Board of Trade soybeans and soyoil.
Some parts of southwest Saskatchewan and southern Alberta are badly in need of rain, which underpinned the market.
Commercial buying was supportive for values.
Bulls in the market worked hard to push the front-month contract back to the psychologically-important C$500 per tonne mark.
Volumes were significantly higher today as most trading sites managed to iron out the bugs after the canola trading platform switched from Winnipeg to New York.
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The Canadian dollar was stronger, relative to its U.S. counterpart, which made canola less enticing to international buyers.
About 12,724 canola contracts traded, which compares with
Monday when 6,000 contracts changed hands. Spreading accounted for 8,456 of the contracts traded.
Settlement prices are in Canadian dollars per metric tonne.
Soybean futures on the Chicago Board of Trade climbed sharply higher on Tuesday, as hot weather is expected to set in on the Midwest starting tomorrow. This is expected to stress the plants as well as yields, which lifted prices.
There are rumours China may be buying some U.S. soybeans as negotiations between the two countries prepare to resume.
Basis levels around the Gulf of Mexico are holding strong.
The corn market also chalked up gains due to the weather concerns.
Moisture levels in much of the U.S. Corn Belt will likely be depleted after the looming heat wave is over. Some of the corn is still pollinating and filling so it comes at a critical time.
There are reports of some pollination problems around Bloomington, Illinois with yields of just 145 bushels an acre.
Chicago wheat futures chopped around for much of the day before rising in speculative buying shortly before the close.
Dryness problems in key parts of Europe and the Black Sea region continue to underpin prices.
There are some ideas the market is overbought.
Wheat markets in Minneapolis and Kansas City recorded light gains on the day.
