Advertisement

North American grain/oilseed review: Canola corrects lower

| 2 min read

By Phil Franz-Warkentin

 

Glacier FarmMedia MarketsFarm — The ICE Futures canola market was weaker on Wednesday, seeing a correction after moving higher the previous four sessions.

Losses in Chicago soyoil and European rapeseed also weighed on values, although canola remains underpriced on the global export market. Malaysian palm oil continued to trade near contract highs, providing underlying support.

Statistics Canada releases updated production estimates on Thursday, Dec. 5, with most market participants expecting a sizeable cut to canola production from the 18.98 million tonnes forecast in September. Canada grew 19.19 million tonnes of canola in 2023/24.

There were an estimated 48,584 contracts traded on Wednesday, which compares with Tuesday when 43,132 contracts traded. Spreading accounted for 35,560 of the contracts traded.

 

SOYBEAN futures at the Chicago Board of Trade were weaker on Wednesday, pressured by favourable South American weather with ample rains and no real issues for developing crops in Brazil or Argentina.

Uncertainty over trade and biofuel policy under incoming United States President Donald Trump kept some caution in the market.

Traders were also following the political turmoil in South Korea, as the country is a major buyer of U.S. commodities. However, the soy market was underpinned somewhat by news South Korea had bought 30,000 tonnes of U.S. soyoil.

 

CORN futures were also pressured by the good South American crop prospects.

U.S. ethanol production dipped off last week’s record high in the latest report, coming in at 1.073 million barrels per day. Stocks of the renewable fuel edged up to just over 23 million barrels.

 

WHEAT was narrowly mixed, with losses in Minneapolis spring wheat and a firmer tone in the winter wheats.

Average trade guesses ahead of Thursday’s Statistics Canada production report call for an increase in Canadian wheat production from the 34.3 million tonnes forecast in September. That would also be up from last year’s 32.9 million tonne crop.

The ongoing conflict between Russia and Ukraine remained a feature in the background of the wheat market.