North American Grain/Oilseed Review: Canola rallies on Monday

The ICE Futures canola market was stronger on Monday, hitting fresh contract highs in many months as a rally in Chicago Board of Trade soyoil provided support.

Weakness in the Canadian dollar contributed to the firmer tone in canola, as the currency dipped below 79 United States cents. The softer currency boosts crush margins and makes exports more attractive for international buyers.

Bullish chart signals were a feature, as speculators continued to hold onto a large net long position.

U.S. markets will be closed this upcoming Thursday for Thanksgiving, while canola will trade its usual hours. Positioning ahead of the U.S. holiday could provide some direction over the next few days.

About 24,910 canola contracts traded on Monday, which compares with Friday when 29,432 contracts changed hands. Spreading accounted for 17,288 of the contracts traded.

SOYBEAN futures at the Chicago Board of Trade were stronger on Monday, with soyoil leading beans higher. Talk that soyoil-based jet fuel could be eligible for tax credits in the United States was behind some of the strength in soyoil that spilled into beans.

Solid recent export demand contributed to the gains, although weekly soybean export inspections were down by more than half-a- million tonnes from the previous week, at 1.7 million tonnes.

Chinese customs data also showed the country’s soybean imports were down considerably so far this marketing year.

CORN was firmer, finding some spillover support from a rally in wheat.

The U.S. corn harvest is nearing completion, with only about five per cent of the crop left on the fields. The slowdown in seasonal harvest pressure added to the firmer tone.

However, relatively good prospects out of South America kept a lid on the upside as production estimates out of Brazil and Argentina point to large crops.

WHEAT posted sharp gains, with weather issues in Australia behind some of the buying interest.

Rains at harvest time in Australia have slowed progress and raised quality concerns in the country. European wheat futures hit contract highs overnight, which spilled into the U.S. market.

Expectations for increased Ukrainian wheat exports this year kept a lid on the upside.

The Western Producer

Tags: corn, canola, soybean futures, wheat, soyoil, ICE Futures, canola market