ICE Canola Futures Mixed, Acreage Numbers As Expected

Statistics Canada released their second acreage estimates for the 2009 growing season, holding wheat acres at the upper end of trade expectations, and boosted spring wheat acres above last year. A decline in acreage for most feed grains was noted by market participants.

The June farm survey, Statistics Canada’s largest area survey, was conducted between May 25 and June 3, covering 25,000 Canadian farmers. As of June 3, western Canadian farmers reported that planting was virtually complete, with unseeded pockets remaining in mainly northern areas and
in the Red River Valley regions of Manitoba affected by the spring floods.

Seeding conditions were variable across the Canadian Prairies, ranging from cool and dry in western areas to cool and excessively wet in eastern regions.

Overall, market participants called the acreage report neutral with most numbers falling within pre-report ideas.

Some of the early weakness in canola was stemming from solid rainfall in many parts of the dry areas of Saskatchewan. The rains, however, were lighter to non-existent for the dry areas of Alberta. Total area affected by the precipitation was estimated at 60% of the dry zone.

The absence of fresh export demand for canola was seen as an undermining price influence.

Support in canola was coming from weakness in the Canadian dollar, the absence of farmer deliveries into the cash pipeline and ideas that crop damage from the drought was too extensive to benefit from the weekend precipitation, brokers said.

Gains overnight in the e-CBOT soybean complex, Malaysian palm oil and European rapeseed futures were supportive for canola as were the higher calls for CBOT soybean and soyoil futures with the start of the North American day session, traders said.

As of 9:50 am EDT, there were only 320 canola contracts traded.

At 9:50 am EDT, no western barley contracts had traded with prices unchanged.

Prices in Canadian dollars per metric ton at 9:50 am EDT: