North American Grain and Oilseed Review: Canola rally snaps
U.S. soybeans, wheat pull back, corn the outlier
By Glen Hallick, MarketsFarm
Glacier Farm Media MarketsFarm – Intercontinental Exchange canola futures closed lower on Wednesday only for the fourth time in the last 20 sessions.
The pressure from losses in the Chicago soy complex and European rapeseed was too much for canola despite support from gains in Malaysian palm oil. Declines in crude oil added to the downturn in most vegetable oils.
A trader noted that Canada’s tight canola supply situation will limit how far its futures can go down. He said farmers are well sold on their canola carried over from last year and are waiting on higher prices for this year’s harvest.
The May canola contract remained handily above its major moving averages, further underpinning canola values.
The Canadian dollar was slightly higher on Wednesday afternoon with the loonie at 69.98 U.S. cents compared to Tuesday’s close of 69.90.
There were 71,351 contracts traded on Wednesday, compared to 72,913 on Tuesday. Spreading accounted for 48,386 contracts traded.
Prices are in Canadian dollars per metric tonne:
Price Change Canola Mar 660.80 dn 3.80 May 669.70 dn 5.40 Jul 673.40 dn 5.70 Nov 649.40 dn 5.00
SOYBEAN futures at the Chicago Board of Trade were lower on Wednesday, due to a lack of fresh bullish news.
The United States Department of Agriculture announced a private sale of 120,000 tonnes of old crop soybeans to unknown destinations.
AgResource upped its projection on the 2024/25 Brazil soybean harvest to 172.28 million tonnes, but Patria Agronegocios dropped its outlook to 165.87 million, while Abiove remained at 171.70 million. Yesterday, the USDA kept its estimate at 169 million tonnes in its monthly supply and demand report.
ANEC increased its call on Brazilian soybean exports for February by 330,000 tonnes to now 10.10 million.
India’s palm oil imports of 275,000 tonnes in January dropped to a 14-year low for the month, as consumers switched to soyoil and sunflower oil.
Ukraine reported its January oilseed exports were 194,000 tonnes, down from 344,000 in December due to tighter supplies.
CORN futures thwarted the downward pressure from soybeans and wheat on Wednesday.
The USDA reported a flash sale for 130,320 tonnes of old crop corn to unknown destinations.
The U.S. Energy Information Administration reported ethanol production for the week ended Feb. 7 averaged 1.08 million barrels per day, down 30,000 BPD from the previous week. Ethanol stocks fell 720,000 barrels at 25.69 million.
ANEC raised its estimate for Brazil corn exports for February by 270,000 tonnes to now 1.30 million.
Patria Agronegocios slashed its forecast for the Brazil corn harvest by 4.80 million tonnes at 125.03 million. On Tuesday, the USDA reduced its call by one million tonnes to 126 million.
WHEAT futures were lower on Wednesday in sympathy with soybeans.
A large winter storm is to bring snow to parts of Kansas, Nebraska, Iowa, Missouri, Wisconsin and Illinois.
The European Commission reported year-to-date wheat exports of 13 million tonnes, down 36.2 per cent from a year ago.
France pegged its soft wheat exports outside of the European Union at 3.40 million tonnes and those within the EU at 6.24 million.
In international purchases, South Korea bought 115,000 tonnes of feed wheat, Japan issued a tender for nearly 124,000 tonnes of wheat and Algeria is looking for up to 600,000 tonnes of wheat.
