North American grain/oilseed review: Canola drops Tuesday
By Phil Franz-Warkentin
Glacier FarmMedia MarketsFarm — The ICE Futures canola market was weaker on Tuesday, falling to the lower end of its sideways trading range as values dipped below chart support and speculative selling built on itself.
January canola settled below both its 20- and 200-day moving averages but remained rangebound overall.
Losses in Chicago soyoil and European rapeseed accounted for some spillover weakness in canola, but Malaysian palm oil was firm on the day.
Uncertainty over possible Chinese tariffs on Canadian canola also kept some caution in the market, although end user demand remains solid underneath the market for the time being. Expectations that Canada’s 2024/25 canola production was well below the 19 million tonnes currently forecast by Statistics Canada also underpinned the market. Updated production estimates will be released Dec. 5.
There were an estimated 36,183 contracts traded on Tuesday, which compares with Monday when 43,723 contracts traded. Spreading accounted for 18,968 of the contracts traded.
SOYBEAN futures at the Chicago Board of Trade were weaker on Tuesday, as good South American production prospects weighed on values.
Brazil’s next soybean crop is 80 per cent seeded, which compares with 68 per cent at the same time last year, according to reports out of the country.
Reports that Brazil will be signing a trade agreement with China tomorrow were also overhanging the market, with more Chinese demand expected to shift southward.
Bearish chart signals contributed to the declines, as the January contract fell back below the psychological US$10 per bushel mark.
The United States soybean harvest was complete as of this past Sunday, reported the U.S. Department of Agriculture. That beat trade estimates and compares with 96 per cent done at the same point last year.
CORN was pulled in two directions, with support from gains in wheat countered by the bearish influence of the losses in soybeans.
The U.S. corn harvest was wrapped up as of Nov. 17 — eight points ahead of last year’s progress at this time.
WHEAT saw a continuation of Monday’s rally, as the escalating conflict between Russia and Ukraine had traders concerned over grain shipments from the region.
The U.S. winter wheat crop was 94 per cent seeded in the latest weekly report, two points off the five-year average. Emergence was estimated at 84 per cent.
Condition ratings improved to 49 per cent good to excellent, from 44 per cent last week. Topsoil and subsoil moisture conditions also improved on the week.
