ICE Futures canola contracts trended lower for most of the week ended Feb. 1 as a number of factors conspired against them. However, prices remain rangebound overall and the market managed to end the week on a minor positive note.

The nearby March contract lost roughly $6 per tonne during the last week of January, finishing the week at $482.40. That took the contract below the 50-day moving average of $485 per tonne, which was bearish from a chart standpoint with the next downside target seen at the nearby lows around $475 per tonne.

On the other side, resistance comes in at $488-$490 per tonne.

The Canadian dollar rallied above 76 U.S. cents during the week, which cuts into crush margins and makes exports less attractive.

While canola exports continued to lag behind the year-ago pace by about 400,000 tonnes, the weekly data was somewhat supportive, with exports during the week ended Jan. 27 hitting their best level in two months.

The release of Statistics Canada’s stocks of principal field crops report on Feb. 5 could provide some nearby direction for canola. Canola supplies in the country, as of Dec. 31, are generally expected to be up slightly from the year-ago level of 13.9 million tonnes. While the report is not typically the most closely followed, it should help provide clarity to the earlier production estimate while also giving a good picture of usage to date.

More attention will be on the U.S. Department of Agriculture monthly world agriculture supply-and-demand (WASDE) report, which will be released Feb. 8. USDA will also be releasing a number of reports from January that were postponed due to the government shutdown, and the sheer volume of data could lead to some wide price swings if there are any surprises.

Grains also rangebound

Soybean futures at the Chicago Board of Trade held in a rather narrow range during the week, as participants were biding their time ahead of the USDA data dump. Trade talks between the U.S. and China were somewhat supportive, as there was talk of large Chinese soybean purchases. However, confirmation was lacking and some buying interest should already be shifting to South America, no matter what happens between China and the U.S.

Hot and dry conditions during the growing season cut into Brazilian crop prospects this year, but the country will still have large supplies to sell that are already finding their way to export positions.

Corn held rangebound during the week, as the grain continued to look for some fresh news to break it out of its sideways trading pattern.

Wheat futures are also stuck in a range, although the U.S. futures have seen more supportive news lately. Rising domestic prices in Russia and talk that the country may need to start curtailing exports should be shifting some demand back to the U.S.

Meanwhile, the bitterly cold temperatures that hit a large portion of U.S. winter wheat-growing regions during the week raised some concerns about winterkill. While snow cover was likely sufficient in most areas, some damage was likely done.