North American grain/oilseed review: Canola falls below former support
By Phil Franz-Warkentin
Glacier FarmMedia MarketsFarm—The ICE Futures canola market dropped to its weakest levels in nearly four years on Friday, breaking below major chart support.
The November contract had held above C$560 per tonne for the past month, but speculative selling quickly built on itself as the market fell below that level on Friday. Losses in Chicago soyoil, European rapeseed and Malaysian palm oil contributed to the weakness in canola, although the Canadian oilseed outpaced those markets to the downside.
News that India was raising import taxes on edible oils by 20 per cent accounted for some of the broad selling pressure in the global oilseed markets, including canola.
Farmers continue to make good harvest progress across most of Western Canada, although many market participants expect actual production may end up below the 19.5 million tonnes forecasted by Statistics Canada in August. The agency releases its next model-based estimates on Monday, Sept. 16.
There were an estimated 59,100 contracts traded on Friday, which compares with Thursday when 51,809 contracts traded. Spreading accounted for 36,550 of the contracts traded.
SOYBEAN futures at the Chicago Board of Trade were weaker on Friday, taking back some of Thursday’s gains.
Looming seasonal harvest pressure was a bearish influence, as farmers look to clean out bin space ahead of an influx of new crop supplies.
On Thursday the United States Department of Agriculture left its estimate on U.S. soybean yields unchanged from the August report at 53.2 bushels per acre, with total production at a record 4.586 billion bushels.
The USDA reported private export sales of 100,000 tonnes of soybeans to China this morning.
CORN was higher, as traders evened positions ahead of the weekend.
The USDA raised its yield estimate for the U.S. corn crop by half a bushel per acre yesterday, pegging total production of the grain at the second largest on record at 15.186 billion bushels.
WHEAT was stronger Friday, with mounting tensions between Russia and Ukraine providing some support after Ukraine accused Russia of striking a civilian grain vessel in the Black Sea.
U.S. wheat ending stocks for 2024/25 were left unchanged at 828 million bushels in yesterday’s USDA report. World wheat ending stocks were raised to 257.22 million tonnes, about two million tonnes above average pre-report expectations.