North American Grain/Oilseed Review: Canola ends mostly lower

The ICE Futures canola market was mixed on Tuesday, with sharp losses in the most active front months and a firmer tone in the lightly-traded new crop contracts.

Chart-based selling was a feature as speculators continued to book profits on their large long positions.

Improving crop prospects for soybeans in South America and resulting declines in the Chicago futures also weighed on the Canadian oilseed. However, gains in soyoil and crude oil provided some underlying support.

Canada’s tight supply situation remained another supportive influence, although the need to ration demand is thought to be well priced into the market for the time being.

About 22,158 canola contracts traded on Tuesday, which compares with Monday when 7,882 contracts changed hands. Spreading accounted for 11,676 of the contracts traded.

SOYBEAN futures at the Chicago Board of Trade were weaker on Tuesday, as much needed rain in Argentina and Brazil took some of the weather premium out of the market as activity resumed after the Martin Luther King Jr. holiday.

However, many areas were still in need of moisture, while the precipitation may be coming too late in others with the harvest just getting started in Brazil.

The National Oilseed Processors Association reported that 186.4 million bushels of soybeans were crushed in the United States in December. That topped trade estimates and marked a new monthly record.

The U.S. Department of Agriculture reported private export sales of 239,000 tonnes of soybeans to Mexico this morning.

Gains in crude oil were supportive for soyoil, helping limit the losses in beans as well.

CORN held closer to unchanged on Tuesday amid some conflicting influences.

The improving South American weather forecasts were also bearish for corn, while strength in crude oil was supportive for the ethanol-linked grain.

A rally in wheat also helped underpin corn.

WHEAT was up double digits in most contracts, with chart-based buying a feature on ideas the recent selloff was overdone.

Forecasts calling for cold temperatures in parts of the U.S. Plains were raising concerns over downgrades to the winter wheat crop.

The geopolitical tensions between Russia and Ukraine were also keeping some caution in the wheat market.

The Western Producer

Tags: corn, soybeans, wheat, soyoil, canola market, futures