By Glen Hallick, MarketsFarm
WINNIPEG, Dec. 30 (MarketsFarm) – Intercontinental Exchange (ICE) Futures canola contracts finished stronger on Monday, due to speculation that the Phase One trade deal between the United States and China could be signed this week.
The South China Morning Post reported today that Vice-Premier Lui He, China’s top trade negotiator, was to travel to Washington this week to sign Phase One. However a White House official said the signing will likely be the following week, but stressed that had yet to be confirmed by U.S. President Donald Trump.
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With the markets craving fresh news, the Post’s report provided a boost to the Chicago soy complex, which spilled over into canola.
An analyst commented the market was very volatile on Monday, but the Phase One news was beneficial. However, he cautioned the gains likely won’t last for much longer.
The loonie, by mid-afternoon Monday, was slightly higher at 76.60 U.S. cents compared to Friday’s close of 76.46. The stronger dollar tempered further gains in canola.
There were 17,350 contracts traded on Monday, which compares with Friday when 22,165 contracts changed hands. Spreading accounted for 10,836 contracts traded.
Settlement prices are in Canadian dollars per metric tonne.
Price Change
Canola Jan 468.70 up 4.90
Mar 479.20 up 5.00
May 488.20 up 4.80
SOYBEAN futures at the Chicago Board of Trade (CBOT) were stronger on Monday, on reports that the Phase One trade deal between the United States and China could be signed in the near future.
As part of Phase One, China is reportedly to purchase US$40 billion in U.S. agricultural goods. To aid that record purchase, China renewed import licenses for a number of genetically modified (GM) varieties of corn, soybeans and canola, as well as allowing the importing of new varieties of GM soybeans.
The U.S. Department of Agriculture (USDA) issued its export inspections on Monday morning, which showed 911,000 tonnes of soybeans were exported for the week ended Dec. 26. So far in the 2019/20 marketing year, the U.S. has exported almost 20.72 million tonnes of soybeans, which is 24.6 per cent ahead of the previous year’s pace. Also of note, approximately 43.6 per cent of soybean exports went to China.
CORN futures were slightly lower on Monday, due to profit-taking.
The USDA reported corn export shipments of 408,946 tonnes for the week ended Dec. 26. At this point in 2019/20, the U.S. has shipped 8.05 million tonnes of corn, which is almost 45 per cent behind last year’s pace.
A major snowstorm struck parts of the U.S. Northern Plains on Sunday. A Colorado Low dumped about 30 centimeters of snow on North Dakota and Minnesota, which effectively shut down any leftover harvesting.
WHEAT futures were mixed on Monday, with gains for Minneapolis and Kansas City bids and a slight loss for Chicago.
In the USDA’s export inspections, 312,017 tonnes of wheat was shipped for week ended Dec. 26. To date in the current marketing year, exports were a little short of 14.50 million tonnes. That was an increase of almost 14.4 per cent compared to this time last year.
