North American Grain/Oilseed Review: Canola continues higher into weekend

The ICE Futures canola market was stronger on Friday, seeing a continued recovery off the nearby lows hit earlier in the week.

Chicago soyoil, European rapeseed and Malaysian palm oil futures were all higher on the day, providing spillover support for canola.

Forecasts calling for hotter temperatures and only sporadic rainfall across the Canadian Prairies contributed to the gains, although trade was thin and choppy.

Weekly Canadian canola exports of 99,100 tonnes during the week ended July 3 were roughly double what moved the previous week, according to the latest Canadian Grain Commission data. However, total exports during the crop-year-to-date of 4.9 million tonnes remain well behind the 10.1 million tonnes moved through 48 weeks of the 2020/21 marketing year.

About 13,404 canola contracts traded on Friday, which compares with Thursday when 18,436 contracts changed hands. Spreading accounted for 6,380 of the contracts traded.

SOYBEAN futures at the Chicago Board of Trade were stronger on Friday, filling a gap on the charts that had formed with Tuesday’s sharp drop lower after the Independence Day weekend.

Weekly United States soybean export sales included net reductions of 160,000 tonnes of old crop business, while new crop business came in at 240,100 tonnes.

Extended forecasts call for hotter temperatures across the U.S. Midwest, with varied rains bringing too much moisture to some areas and not enough to others.

Updated supply/demand estimates from the U.S. Department of Agriculture will be released next week, with average trade guesses calling for a cut in U.S. soybean production from earlier forecasts.

CORN was also underpinned by the hot U.S. weather forecasts and pre-weekend positioning.

Weekly U.S. corn export sales saw net reductions of 66,000 tonnes of old crop business, with new crop business of 111,200 tonnes.

Brazil’s CONAB raised their estimate on the size of the country’s corn crop to 115.7 million tonnes, which would be in line with the USDA’s forecast.

WHEAT posted solid gains, with talk of possible Chinese demand behind some of the strength as the recent weakness in wheat likely brought in some bargain hunting from end users.

Chart-based positioning ahead of the weekend was a feature on ideas the losses earlier this week were overdone.

Weekly U.S. wheat export sales came in at 286,400 tonnes, which was at the lower end of expectations.

The advancing U.S. winter wheat harvest put some pressure on values.

Tags: palm oil, futures, Market, exports, corn, canola, soybean, wheat, soyoil, rapeseed