It was a volatile time for the ICE Futures Canada canola market during the week ended June 16 as the weight of the rising Canadian currency offset gains in vegetable oil.
The most active November canola contract lost $6.70 to fall to $488.20 by Friday’s close. The nearby July contract lost just 50 cents as it was primarily used in spread trade.
The loonie gained two per cent during the week amid ideas that the Bank of Canada may become more aggressive in the near future.
Rain across the Prairies relieved concerns over excessively dry conditions in certain canola-growing areas, which was bearish for prices.
Liquidation of long contracts and increased farmer selling helped to weigh down the market.
Questions about the amount of canola left over from last year that never got harvested also threw some caution into the market.
On the other side of the coin, tightness in commercial supplies of canolaunderpinned the market while uncertainty over the weather situation also added support.
The crush rate has come off the lofty highs it saw earlier in 2017 but is still churning along, meaning demand may need to be rationed before the country runs out of supplies.
Soybeans on the Chicago Board of Trade posted some mild gains on the week, but are still dwelling near their lowest levels in a few months due to the increase in U.S. plantings. Some analysts estimate as many as four million additional acres may have gone in due to dry soil conditions that prompted corn farmers to switch out their crops.
Corn futures ticked slightly lower as rain in key corn-growing regions of the U.S. Plains helped offset scorching temperatures and concerns over dryness. Large crops in Brazil and Argentina also weighed on prices.
Minneapolis spring wheat prices skyrocketed during the week, as dry conditions led to poor quality. Companies have been scouring the U.S. Plains in search of high-protein supplies.
Kansas City and Chicago wheat futures also posted gains with concerns over quality leading the way. Drought-like conditions are also setting into some portion of the U.S. Plains, raising worries for farmers.