North American Grain/Oilseed Review: Canola rallies higher with soy complex

The ICE Futures canola market was stronger on Monday, hitting fresh contract highs as bullish technical signals kept speculators adding to their large net-long positions.

Advances in the Chicago Board of Trade soy complex provided spillover support, with Malaysian palm oil also up sharply in overnight activity.

Ideas that canola remains cheap compared to other oilseeds, despite its continued strength, contributed to the gains.

Tight old crop supplies and uncertainty over new crop production were also supportive.

However, some profit-taking came forward at the highs to temper the advances.

About 11,412 canola contracts traded on Monday, which compares with Thursday when 23,312 contracts changed hands. Spreading accounted for 6,182 of the contracts traded.

SOYBEAN futures at the Chicago Board of Trade were stronger on Monday, with solid export demand over the weekend behind some of the gains.

The United States Department of Agriculture announced private export sales of nearly 700,000 tonnes of U.S. soybeans to China on Good Friday, when the futures markets were closed, with an additional 177,000 tonnes to other unknown destinations also reported. The bulk of the business was for movement during the current marketing year.

The National Oilseed Processors Association reported that the U.S. soybean crush hit 181.76 million bushels in March, which was a record for the month. However, soyoil stocks still came in below trade expectations, down by about seven per cent from February at about 1.9 billion pounds.

CORN hit fresh contract highs, climbing above US$8.00 per bushel in the old crop contracts.

Cool and wet conditions continue to limit corn planting progress across the U.S., with about five per cent of intended acres thought to be in the ground by now. Meanwhile, dryness in the forecasts for corn growing regions of South America was also supportive.

Ukraine’s ag ministry released updated seeding estimates, raising their forecast for total spring seeded crops to 14 million hectares. That would be up by 600,000 from an earlier estimate, but still down 17 per cent on the year.

WHEAT was sharply higher, with the ongoing conflict in Ukraine keeping a risk premium in the market.

Dryness in the southern U.S. Plains and cool/wet conditions likely delaying spring wheat seeding to the north provided additional support.

Tags: palm oil, wheat futures, Market, canola, soybean futures, corn futures, oilseeds