By Glen Hallick, MarketsFarm
WINNIPEG, April 12 (MarketsFarm) – ICE Futures canola contracts finished steady on Friday. A major feature of trading today was rolling out of the May contracts into July.
Ongoing tensions between Canada and China continued to weigh on values, and the technical bias is to the downside. Prairie spring road bans and farmer reluctance to sell were supportive of values.
Farmers in Western Canada, especially in Alberta and Saskatchewan, have started planting. Expectations have been for less canola planted this year than in 2018. However, Glacier Farm Media’s Allan Dawson reported otherwise. Dawson wrote that few farmers have cancelled their canola seed orders.
Statistics Canada will shed light on planting intentions on April 24, with their 2019/20 Principal Field Crop Acreage report.
With heavy snow in the United States portion of the Red River Valley, high water levels are being reassessed by Manitoba flood forecasters. Expectations were for levels similar to those in 2011, but could increase with a revised forecast.
The Canadian dollar was hovering around 75 U.S. cents by midafternoon on Friday.
There were 34,866 contracts traded on Friday, which compares with Thursday when 38,258 contracts changed hands.
SOYBEAN futures at the Chicago Board of Trade were unchanged on Friday.
A bomb cyclone struck parts of the United States Corn Belt with snow, and parts of the Midwest with rain Thursday and Friday. Another system was forecast to hit the Delta region and the Ohio River and Mississippi River valleys this weekend. A third storm system follows next week.
The wet conditions will force U.S. farmers to switch their planting intentions away from corn to soybeans.
A rather mild El Nino is expected for the U.S. this summer and the weather phenomenon could help corn and soybean yields, but detrimental to wheat yields.
China’s imports of soybeans were up 10 per cent in March compared to February. China received 4.9 million tonnes, mostly from the U.S. and Brazil. But the March imports are 13 per cent less than what China received the same time last year.
And China’s demand for soybeans may decrease as African Swine Fever has taken its toll on the country’s hog population. About a third of all hogs have been culled in the country after 120 cases of African Swine Fever have been found since August.
CORN futures were steady on Friday.
The U.S. Environmental Protection Agency (EPA) may grant fewer biofuel waivers, exempting small refineries from the country’s biofuel policy. Lower prices for blending credits have reduced the cost of compliance, according to the EPA’s administrator.
The U.S. Department of Agriculture pegged Argentina’s corn crop at 47 million tonnes. The Buenos Aires Grain Exchange projected the country’s corn harvest to reap 48 million tonnes.
Strategie Grains predicted the European Union corn acres to increase four per cent in 2019 from last year, to almost 21.5 million acres. That is expected to produce two per cent more corn at more than 9.8 million tonnes.
WHEAT futures were mixed on Friday, with prices down in Minneapolis, but up in Chicago and Kansas.
The above mentioned storms could lead U.S. farmers switching their planting intentions away from wheat to soybeans. Already, USDA forecasts projected the fewest spring wheat acres planted in a century.
Algeria purchased more than 727,000 tonnes of milling wheat from optional origins, with shipment in June.
Egypt purchased over 323,000 tonnes of wheat in an international tender on Friday. Two-thirds will come from Romania and the remainder from Ukraine, with shipment from May to June.
Commodity Future Prices
Prices are in Canadian dollars per metric ton