WINNIPEG, Nov. 7 (MarketsFarm) – Intercontinental Exchange (ICE) Futures canola contracts finished lower on Thursday, retreating from previous highs due to lack of follow-through buying. One trader noted that markets were range-bound, lacking a strong sense of direction.
The announcement that China will resume importing Canadian pork and beef sparked some optimism regarding a trade deal for canola between the two countries. It doesn’t appear that China will start buying canola again any time soon, but canola export demand has remained consistent despite a lack of buying from China. Crush margins have more than doubled over the past year.
The Canadian dollar dipped hovered around 75.8 U.S. cents on Thursday afternoon, providing some support to canola values.
Some experts are anticipating soybean production to be revised slightly downward in tomorrow’s World Agriculture Supply Demand Estimates (WASDE) from the United States Department of Agriculture (USDA).
On Thursday, 13,784 contracts were traded, which compares with Wednesday when 20,542 contracts changed hands. Spreading accounted for 6,574 contracts traded.
SOYBEAN futures at the Chicago Board of Trade (CBOT) were higher on Thursday due to strong export demand. This morning, the United States Department of Agriculture (USDA) reported a private export sale to the Philippines totaling 133,000 tonnes.
Last week, net soybean sales totalled 1.8 million metric tonnes, which was a 92 per cent increase from the previous week and 42 per cent higher than the four-week average. About 52 per cent of all soybeans shipped were destined to China.
Soybean cake and meal sales were around 262,000 tonnes, purchased primarily by the Philippines, Colombia and Mexico. Soybean oil sales totaled about 4,000 tonnes, which was less than trade expectations.
CORN futures were lower today, though last week’s export sales were in line with trade expectations.
Approximately 488,000 tonnes of corn were sold last week, which is down 11 per cent from the previous week, but up by 15 per cent from the four-week average. Purchases were made by the Philippines, Thailand, and other unknown destinations.
WHEAT futures were lower on Thursday. Net sales totaled 360,000 tonnes last week, which is down by 27 per cent from the week prior.
A recent report from the USDA showed transportation costs for shipping wheat from the Midwest to Japan increased during the third quarter of 2019, mainly due to higher freight and ocean rates. Shipping costs from Kansas and North Dakota in particular increase by four per cent year-over-year.
Russia has reduced their wheat production forecast by 5 million tonnes based on early harvest results. However, the country’s overall grain production for 2019 is expected to be higher than last year.
Commodity Future Prices
Prices are in Canadian dollars per metric ton