By Glen Hallick, MarketsFarm
WINNIPEG, March 3 (MarketsFarm) – Intercontinental Exchange (ICE) Futures canola contracts stronger on Wednesday, building on yesterday’s gains in an independent show of strength.
Reduced supplies have continued to underpin canola values.
A Calgary-based analyst said the edible oils markets are quite volatile, which can lead to wide swings of prices from day to day.
Despite a forecast of above normal temperatures for the Prairies, the analyst stressed this will not have an immediate effect on the futures. However, the region is already contending with a thin snow cover and dry soil conditions.
At mid-afternoon, the Canadian dollar was a pinch lower. The loonie was at 79.12 U.S. cents, after closing Tuesday at 79.20.
There were 11,361 contracts traded on Wednesday, which compares with Tuesday when 19,239 contracts changed hands. Spreading accounted for 4,798 contracts traded.
Settlement prices are in Canadian dollars per metric tonne.
Canola May 767.30 up 14.20
Jul 728.30 up 12.70
Nov 610.60 up 9.40
Jan 613.30 up 9.20
SOYBEAN futures at the Chicago Board of Trade (CBOT) were lower on Wednesday, as the long liquidation continued.
Declining soybean supplies in the United States had led to the rationing of inventory, both domestically and globally.
Wet conditions in Brazil continued to slow the soybean harvest. Progress was a little more than 23 per cent complete, which is about half of where the harvest was this time last year.
Dry conditions in Argentina could hamper its soybean crop. Some projections have lowered the harvest from 46 million tonnes to between 43 million and 44 million, should adequate rains not come over the next two weeks.
The United States Department of Agriculture (USDA) attaché in Argentina estimated that country’s soybean harvest to be 47.49 million tonnes, for a reduction of 500,766 tonnes from the department’s February report.
CORN futures were lower on Wednesday, also due to the long liquidation.
The U.S. Energy Information Administration (EIA) reported 849,000 barrels of ethanol per day were produced for the week ended Feb. 26, which indicated production, had yet to fully recover of the unusual cold snap. Ethanol stocks were down 360,000 barrels at nearly 22.43 million, compared to 25 million a year ago.
The planting of the safrinha (second) corn crop in Brazil was reported at nearly 32 per cent complete. Production estimates range from 95 million to 111 million tonnes. The harvest of the first corn crop was reported at about 23 per cent finished and on par with the year ago pace.
WHEAT futures were down on Wednesday, following soybeans and corn.
A winter storm is forecast for the U.S. Southern Plains, which could help to alleviate the region’s dry conditions. Rain is expected to begin falling over Central and Southern Rockies on Thursday morning.
In international purchases, Algeria tendered for 50,000 tonnes of wheat, Japan called for almost 83,000 tonnes, the Philippines tendered for 145,000 tonnes, and Pakistan issued a tender for 300,000 tonnes.