By Dave Sims and Jade Markus, Commodity News Service Canada
Winnipeg, March 28 – THE ICE Futures Canada canola market finished higher Monday, as short-covering from large funds and wide-spread strength in the vegetable oil market pushed values higher.
Dryness in parts of Western Canada was supportive and volumes were light.
Malaysian palm oil hit a two-year high overnight that had a spillover effect on canola, according to a Winnipeg-based trader.
However, the Canadian dollar was more than half a cent stronger relative to its US counterpart, which made canola less attractive to domestic crushers and foreign buyers.
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“The crush is under a little bit of pressure but I don’t think it’s the crusher that’s the focus here this, it’s more the fund short covering,” said the trader.
Farmer selling is on the rise as canola hits various price targets, he added.
On April 1st, China is scheduled to lower the amount of dockage it accepts on shipments of canola, which has thrown some uncertainty into the market.
Crude oil was weaker and large supplies of soybeans from South America are having a bearish effect on the market.
Around 13,495 canola contracts were traded on Monday, which
compares with Thursday when around 8,238 contracts changed hands. Spreading accounted for about 5,730 of the contracts traded.
Milling wheat, barley and durum were all untraded.
Settlement prices are in Canadian dollars per metric tonne.
SOYBEAN futures at the Chicago Board of Trade closed about one to two cents per bushel lower on Monday after sharp advances earlier in the day, as traders moved positions ahead of a spring planting intentions report due out from the United States Department of Agriculture on Thursday.
Analysts expect the report to show an increase in soybean’s seeded area.
However, strong demand for the commodity limited some losses.
SOYOIL prices settled stronger on Monday, tracking Malaysian palm oil.
SOYMEAL closed weaker on Monday, tracking nearby oilseed markets.
CORN futures closed mixed, but mostly unchanged, on Monday, propped up by spill over support from wheat.
However, good seeding conditions for corn in the US Southern Plains put a lid on gains in far contracts.
China’s corn futures dropped on Monday, which added pressure to CBOT corn.
High global supplies further weighed on prices.
WHEAT closed stronger about six to eight cents per bushel on Monday, supported by dryness in the US Southern Plains.
An anticipated period of dryness in some US wheat-growing regions over the next few weeks is bullish, as dry weather puts crop development at risk.
A dry winter also propped up prices, as it hampers winter wheat development.
A weaker US dollar further supported prices by making wheat more appealing to foreign buyers.
Technical buying was also a feature on Monday.
– Russia is now the second-largest wheat exporter globally. They are expected to move about 23 million metric tonnes this marketing year.
– The CEO of US-based National Association of Wheat Growers will be resigning at the end of May.
