North American grain/oilseed review: Canola drops with soyoil

By Phil Franz-Warkentin

Glacier FarmMedia MarketsFarm – The ICE Futures canola market posted sharp losses on Tuesday, as a selloff in Chicago soyoil spilled over to weigh on values. European rapeseed and Malaysian palm oil futures were also lower.

Widespread rains across the Prairies may delay seeding operations but were seen as beneficial for crops in the long run, with the improving moisture conditions adding to the softer tone in canola.

Chart-based speculative selling contributed to the losses as some stops were hit on the way down. However, the general uptrend remained intact despite Tuesday’s correction.

There were an estimated 41,176 contracts traded on Tuesday, which compares with Monday when 49,666 contracts traded. Spreading accounted for 15,976 of the contracts traded.

SOYBEAN futures at the Chicago Board of Trade were weaker on Monday, as a sharp decline in soyoil weighed on values. Traders reacted to news that used cooking oil was not included in newly announced United States tariffs on Chinese imports. Soyoil had climbed higher in recent days on rumours that import duties on cooking oil would be increasing.

U.S. soybean planting was 35 per cent complete as of this past Sunday, which was in line with the five-year average but 10 points off last year’s pace.

Brazil’s Conab raised their call on the country’s soybean crop to 147.7 million tonnes, which compares with an earlier estimate of 146.5 million.

CORN was also lower. Conab raised their forecast for Brazil’s corn crop to 111.6 million tonnes, up by about 700,000 tonnes from an earlier estimate.

Recent rains have delayed corn seeding across the Midwest, with 49 per cent of intended acres in the ground as of this past Sunday. That compares with the five-year average of 54 per cent done and 60 per cent at the same time a year ago.

The U.S. Department of Agriculture announced private export sales of 405,000 tonnes of corn to Mexico this morning, with a third of the business to move during the current marketing year and the remaining to move next year.

Weather concerns in Russia remained supportive for WHEAT, but ideas the recent gains were starting to look overdone had speculators booking profits on Tuesday.

U.S. winter wheat condition ratings held steady at 50 per cent good-to-excellent in the latest weekly report.

Spring wheat seeding in the U.S. came in at 61 per cent complete, which was ahead of the five-year average of 48 per cent.