North American grain/oilseed review: Canola weakens despite tight stocks

By Phil Franz-Warkentin

Glacier FarmMedia | MarketsFarm — The ICE Futures canola market settled with small losses on Thursday after trading within a wide range.

Confirmation of tightening supplies provided early support. Statistics Canada reported canola stocks in all positions as of March 31 at 5.9 million tonnes. That was down 38.7 per cent from the same point a year ago and well below the five-year average of 8.3 million tonnes.

Futures climbed higher in response to the data, with gains in Chicago soyoil providing additional support. A weaker tone in the Canadian dollar also underpinned the canola market.

However, canola ran into resistance at the highs, and chart-based positioning weighed on values as the day progressed.

There were 42,012 contracts traded on Thursday, which compares with Wednesday when 33,751 contracts changed hands. Spreading accounted for 18,492 of the contracts traded.

SOYBEAN futures at the Chicago Board of Trade moved higher on Thursday, with a rally in soyoil providing support.

Weekly U.S. soybean export sales of 376,700 tonnes of old crop business and an additional 9,800 tonnes of new crop were in line with trade estimates.

The U.S. Department of Agriculture also reported additional private export sales of 225,000 tonnes of soybeans to Pakistan this morning.

The good U.S. seeding weather was taken as supportive for soybeans, as it should allow farmers to get all their intended corn in the ground and not switch later acres to soybeans.

Canadian soybean stocks as of March 31 were up 11 per cent from the same time a year ago at 2.4 million tonnes.

CORN was also pressured by the good U.S. weather and planting progress. Midwestern forecasts look favourable for seeding over the next 10 days.

Canadian corn stocks as of March 31 came in at 7.2 million tonnes, which was down 13 per cent year-on-year.

Weekly U.S. corn export sales topped trade expectations at 1.66 million tonnes, providing some support.

The U.S. Department of Agriculture releases updated supply/demand estimates on May 12, with pre-report positioning a feature.

WHEAT was also lower, amid a lack of any major weather concerns for the U.S. crop.

Weekly U.S. wheat export sales included 69.659 tonnes of old crop business and just under half a million tonnes of new crop sales.

Canadian wheat stocks as of March 31 were down 1.2 per cent on the year, at 15.4 million tonnes.