ICE Canola Futures Down, Strong C$ Bearish

The Canadian currency in early Friday morning activity, was trading at 95.65 US cents or C$1.0454 to one US$.

The USDA early Friday predicted US soybean production will reach 3.25 billion bushels, its highest level ever. The USDA on Friday also raised its forecast for soybean ending stocks this year to 230 million bushels, a 10-million-bushel increase from the September prediction.

The declines in canola were a reflection of the strong Canadian dollar and the anticipated losses seen in CBOT soybean and soyoil futures with the start of the North American day session, brokers said.

Adding to the downward price push in canola will be the lower starts forecast for CBOT corn and wheat values, traders said.

Some of the weakness in canola also reflected the increased attention to the South American soybean crop, where sizeable production increases are expected this year. Planting operations were just getting underway there now, brokers said.

Large crop prospects for canola in Canada and continued bearish chart signals were also seen as an undermining price influences, traders said.

Some underlying support in canola came rom the upward price rebound in Malaysian palm oil futures overnight. The lack of farmer deliveries of canola into the cash pipeline was also providing some underlying support.

Talk of Chinese interest this week also was a supportive price factor. Exporters noted that China had been seeking canola at the beginning of the week although no deals were made. They expect China to be back in the canola market next week following this week’s Chinese holidays.

As of 9:45 am EDT, there were 933 canola contracts traded.

As of 9:45 am EDT, no western barley contracts had been traded.