North American grain/oilseed review: Canola drops sharply lower

By Phil Franz-Warkentin

Glacier FarmMedia | MarketsFarm — The ICE Futures canola market was weaker on Tuesday, falling below nearby chart support as activity resumed after the Thanksgiving weekend.

The Chicago soy complex was down sharply on Monday when the canola market was closed. Soybeans remained pointed lower on Tuesday, although a recovery in soyoil helped temper the declines in canola. Losses in crude oil were another bearish influence on Tuesday.

November canola settled below C$600 per tonne, which was bearish from a technical standpoint. Speculators were thought to be putting on fresh short positions after booking profits and covering some of their previous bearish bets in recent weeks.

There were an estimated 86,728 contracts traded on Tuesday, which compares with Friday when 74,575 contracts traded. Spreading accounted for 54,742 of the contracts traded.

SOYBEAN futures at the Chicago Board of Trade were weaker on Tuesday, as improving moisture conditions for soybean seeding in Brazil and sharp losses in crude oil weighed on values.

Conab in Brazil estimated the country’s next soybean crop at 166.05 million tonnes. That would be three million tonnes below the United States Department of Agriculture’s current estimate for the country, but still nearly 19 million tonnes larger on the year.

An estimated 177.32 million bushels of soybeans were crushed in the U.S. in September, according to a report from the National Oilseed Processors Association. That topped trade estimates and marked a new record for the month. However, soyoil stocks were still down by 6.3 per cent from August, at 1.066 billion pounds — the tightest supplies in nearly a decade

The USDA announced private export sales of 131,000 tonnes of soybeans to China this morning. Weekly export inspections showed 1.575 millkon tonnes of soybeans left the U.S. last week, with just over a million tonnes of that total destined for China.

Sharp losses in crude oil weighed on the ethanol-linked CORN market.

Conab estimated Brazil’s 2024/25 corn production at 119.7 million tonnes, which would be up by about four million on the year but short of the USDA’s current call around 127 million tonnes.

WHEAT was lower, with forecasts calling for rain in some dry regions of Russia weighing on prices. Rains are also in the forecast for some parts of the southern U.S. Plains in need of moisture.

The USDA announced private export sales of 120,000 tonnes of soft red winter wheat to Mexico this morning.