North American grain/oilseed review: Canola ends with small losses after choppy day

By Phil Franz-Warkentin

Glacier FarmMedia MarketsFarm – The ICE Futures canola market settled with small losses on Wednesday after trading to both sides of unchanged in choppy activity.

The most-active November contract held onto gains for most of the session but settled roughly C$10 per tonne off its highs for the day and below psychological support as speculative selling pressure weighed on values.

Losses in Chicago soyoil and Malaysian palm oil also weighed on values, although soybeans and European rapeseed were both higher on the day.

Canola remains a bargain compared to other global oilseeds, which should be providing some support, according to an analyst. A lack of significant farmer selling, despite the advancing harvest, also underpinned the market.

There were an estimated 30,955 contracts traded on Wednesday, which compares with Tuesday when 43,968 contracts traded. Spreading accounted for 17,298 of the contracts traded.

SOYBEAN futures at the Chicago Board of Trade held onto small gains on Wednesday, as speculative short covering ahead of Thursday’s monthly United States Department of Agriculture supply/demand report provided support.

While dryness during the growing season may have cut into soybean production prospects, average trade guesses ahead of Thursday’s report call for soybean yields to hold steady with previous estimates, with only minor adjustments to stocks numbers expected.

Barring any surprises in the data, attention in the markets is expected to start shifting towards South America, where Brazilian farmers are in the early stages of seeding their next soybean crop.

CORN was steady to higher, also seeing some position evening ahead of the USDA report.

Average trade estimates are calling for a small cut in U.S. corn yields from the August forecast, with small downward revisions to ending stocks also likely.

Weekly U.S. ethanol production data showed a small increase in production of the renewable fuel during the past week, to 1.08 million barrels per day.

WHEAT was stronger, with Thursday’s report not expected to include any major adjustments to the U.S. wheat production numbers. However, world and U.S. stocks could be revised slightly lower.

Uncertainty over wheat exports out of Russia and Ukraine provided some support.