By Dave Sims and Jade Markus, Commodity News Service Canada
Winnipeg, March 10 – THE ICE Futures Canada canola market was sharply higher Thursday, tracking changes in the Canadian currency and ideas recent losses were overdone. The move above nearby resistance on the charts triggered stops which sparked additional buying, a trader said.
The Canadian dollar was weaker relative to its US counterpart which made canola more attractive to out-of-country buyers.
Speculators were covering shorts which added to the aggressive buying, and the demand was starting to come to the “front-end” of the market-place, according to an analyst.
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“We’re getting a firm bounce-back and the cash basis is starting to improve in various locations,” he added.
Commercial demand is relatively steady while Chicago soybeans were higher on the day.
However, losses in the vegetable oil market and crude oil were bearish for canola.
Uncertainty in the Chinese market and their recent changes to dockage allowances in canola imports also weighed down prices.
The large soybean crop in South America undermined prices.
SOYBEAN futures at the Chicago Board of Trade closed about two to three cents per bushel stronger on Thursday, extending gains from United States Department of Agriculture (USDA) data.
The USDA projected slightly smaller stockpiles of soybeans, which is supportive, especially as many US commodities have been pressured by heavy global stocks.
Investor short-covering was also a feature on Thursday.
SOYOIL prices settled weaker on Thursday.
SOYMEAL closed stronger on Thursday, tracking nearby grain and oilseed markets.
CORN futures closed about two to three cents per bushel higher on Thursday, propped up in-part by strength in the nearby wheat market.
Slightly lower corn stocks projected by the USDA also supported prices on Thursday.
Rain in the Delta region of the US was also a feature on Thursday, as it could hamper early seeding potential.
WHEAT closed about eight cents per bushel stronger on Thursday as the market continued to react to USDA data.
The USDA left its domestic wheat inventory outlook mostly unchanged on Wednesday, which supported prices in the midst of a global glut.
A reduced wheat production forecast from the USDA for India and Australia further propped up prices on Thursday.
– US weekly export sales for the week ended March 3 totalled 330,600 metric tonnes for delivery in marketing year 2015/2016 were down four per cent from the previous week, but up six per cent from the prior four-week average, the USDA said in a report on Thursday.
– India’s wheat crop is at risk of being damaged by rain and hail over the next four days, according to reports.
