North American Grain/Oilseed Review: Canola continues lower

The ICE Futures canola market was weaker on Thursday, seeing a continuation of Wednesday’s selloff as investors continued to back away from riskier assets and book profits on their long positions.

Losses in Chicago Board of Trade soyoil and other vegetable oil markets accounted for some spillover selling pressure. However, soybeans were stronger which provided some support.

News that China would lift import restrictions on canola imports from Canadian grain companies Viterra and Richardson International also helped underpin the futures, although tight old crop supplies will limit any actual movement for the time being.

Uncertainty over new crop production also underpinned the canola market. Seeding remains delayed in the eastern Prairies, although the moisture situation has improved dramatically over the past year which should bode well for production once the crop gets in the ground.

Planting in Saskatchewan was 33 per cent complete, according to a report out earlier today, which was about 20 points off the average for this time of year. Only 19 per cent of intended canola acres were in the ground.

About 15,902 canola contracts traded on Thursday, which compares with Wednesday when 18,220 contracts changed hands. Spreading accounted for 9,360 of the contracts traded.

SOYBEAN futures at the Chicago Board of Trade moved higher on Thursday, benefitting from some solid export demand.

The United States Department of Agriculture reported weekly U.S. soybean export sales of just over 900,000 tonnes of old and new crop business combined, which was at the higher end of trade expectations.

Indonesia announced they would soon be lifting a ban on palm oil exports, providing support for the vegetable oil markets in general.

However, soyoil was still down on the day, as adjustments to the oil/meal spread favoured meal on the day.

CORN was pulled in two directions by the gains in soybeans and losses in wheat.

Weekly U.S. corn export sales came in at about a million tonnes, which was at the higher end of expectations.

Declining crop estimates on the size of Brazil’s second corn crop were somewhat supportive, while better weather for seeding the US crop weighed on the other side.

WHEAT was down across the board, continuing to back away from the highs hit earlier in the week.

The losses came despite a crop tour of U.S. hard winter wheat growing regions showing yields down considerably from a year ago

Weekly U.S. wheat export sales of 334,000 tonnes of old and new crop business combined were in line with expectations.

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