North American Grain/Oilseed Review: Canola mixed at final bell

The ICE Futures canola market was mixed at Tuesday’s close as spillover pressure from declines in the Chicago soy complex was countered by concerns over Canadian production.

Chart-based speculative selling weighed on the nearby July contract. Traders exited long positions in the front month while most of the buying interest has shifted to the new crop.

Losses in soybeans and soyoil in the United States were bearish, but canola had already moved lower on Monday when U.S. markets were closed for Memorial Day.

Uncertainty over new crop production provided underlying support. Persistent rains in the eastern Prairies continue to delay seeding in the region. Meanwhile, dry crops in the western growing regions could use some more moisture.

About 16,313 canola contracts traded on Tuesday, which compares with Monday when 3,706 contracts changed hands. Spreading accounted for 6,876 of the contracts traded.

SOYBEAN futures at the Chicago Board of Trade were weaker on Tuesday, with profit-taking after Friday’s gains a feature as activity resumed following the Memorial Day long weekend.

The European Union has agreed in principle to ban 90 per cent of Russian oil imports for the next six months, which accounted for some strength in world energy markets on Tuesday. Soyoil initially moved higher but ran into resistance and the eventual turn lower contributed to the declines in beans.

The United States soybean crop is estimated to be about two-thirds seeded, which would be in line with the five-year average but well off last year’s pace. Farmers in most regions still have another 10 days to get the crop in the ground before insurance deadlines.

Brazil’s soybean harvest is nearing completion, according to reports although some southern regions still need some drier weather to finish off.

CORN futures were weaker in sympathy with soybeans and wheat.

Favourable seeding weather has allowed U.S. farmers to make some planting progress over the past week, with only about 10 per cent of intended corn acres left to go in the ground.

WHEAT was down sharply, posting limit-down losses in some contracts. Talk that Russia will allow grain exports to leave Ukraine accounted for some of the selling pressure, although no wheat has moved yet as Russia has said allowing exports would be dependent on the easing of sanctions.

Better weather for the U.S. winter wheat crop over the past week along with forecasts calling for a good monsoon season in India were also bearish.

However, spring wheat seeding delays in North America provided some support. Planting of the crop would normally be nearing completion at this time of year, but about a third of the U.S. spring wheat is still unseeded.

Tags: soyoil, crop, soy, wheat futures, Market, canola, soybean futures, corn futures, soybeans, Production