By Dave Sims and Phil Franz-Warkentin, Commodity News Service Canada
Winnipeg, October 2 – THE ICE Futures Canada canola market ended on a stronger note as values took strength from large gains in US soyoil.
The market also received support after a crop estimate from Statistics Canada came in at the low end of expectations. The report pegged 2015 canola production at 14.3 million metric tonnes. There are ideas though that the crop is likely closer to 15 million tonnes and should increase on subsequent surveys.
Steady commercial demand and sluggish farmer selling contributed to the gains.
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However, the Canadian dollar was stronger relative to its US counterpart which made canola less attractive on the international stage.
Losses in US soybeans also weighed on values.
A total of 24,247 canola contracts were traded on Friday, which compares with Thursday when 33,628 contracts changed hands. Spreading accounted for 14,144 of the contracts traded.
Milling wheat, barley and durum were all untraded.
Settlement prices are in Canadian dollars per metric ton.
SOYBEAN futures at the Chicago Board of Trade saw some choppy activity to end the week, but settled with losses of one to three cents per bushel.
A weaker tone in the US dollar, brought on by some disappointing US employment data, provided some early support for soybeans. However, the market ran into resistance, with spec selling ahead of the weekend weighing on prices.
The advancing US harvest and generally improving yield prospects contributed to the eventual losses in soybeans, according to participants.
SOYOIL settled higher on Friday, with gains in crude oil and spreading against soymeal behind some of the strength.
SOYMEAL futures were down on Friday.
CORN futures in Chicago were narrowly mixed on Friday, settling within a penny of unchanged after a choppy day as the crop continues to lack any fresh fundamental news.
The situation in corn was similar to that in soybeans, with support from the weaker US dollar being countered by the advancing harvest.
Expectations for increased competition from South America were also overhanging the corn market.
WHEAT futures in Chicago were down by three to five cents per bushel on Friday, as the short-covering bounce that supported values in recent days ran out of steam.
Poor export demand remains the major bearish influence for the US wheat futures, as the country remains overpriced in the global market.
However, weather concerns in some wheat growing regions of the world – including dryness in Australia and the Black Sea region, did provide some support. Concerns over possible seeding delays in the US were also supportive.
– Taiwan signed a letter of intent to purchase 1.7 million tonnes of US wheat over the next two years, according to the US Wheat Associates. The deal is reported to be worth US$3.03 billion.
– Canada’s wheat production was estimated at 26.1 million tonnes by Statistics Canada in a report out Friday. That was up by 1.4 million tonnes from the August estimate, but still below the 29.4 million tonnes grown the previous year.
– Of that total, Canadian durum production for 2015 is estimated at 4.7 million tonnes by StatsCan, which was in line with trade guesses, but below the 5.2 million grown last year.
