North American Grain/Oilseed Review: Canola drops with profit-taking

WINNIPEG, March 10 (MarketsFarm) – The ICE Futures canola market was weaker on Wednesday, with speculative profit-taking a feature as investors liquidated long positions.

Losses in Chicago Board of Trade soybeans and soyoil put spillover pressure on canola, although soyoil had moved well off its lows by the close.

Soyoil was down sharply in early activity, but recovered to closer to unchanged. Malaysian palm oil hit 13 year highs overnight, which was supportive for vegetable oil markets in general.

While canola was due for a correction from a chart standpoint, the underlying fundamentals of tight old crop supplies remained supportive.

About 24,034 canola contracts traded on Wednesday, which compares with Tuesday when 32,256 contracts changed hands. Spreading accounted for 12,794 of the contracts traded.

SOYBEAN futures at the Chicago Board of Trade were weaker on Wednesday, as the lack of a bullish spark from yesterday’s monthly supply/demand report from the United States Department of Agriculture left room for speculative profit-taking to weigh on prices.

The USDA left its ending stocks forecast for U.S. soybeans this crop year unchanged at 120 million bushels yesterday, but increased world stocks slightly.

Forecasts calling for some better harvest weather in Brazil added to the softer tone in soybeans. However, wet conditions in the country continue to cause delays, while yield losses in Argentina are expected due to dryness there.

CORN was also down amid a lack of fresh supportive news. The projected U.S. corn carryout for the year was left unchanged at 1.502 billion bushels by the USDA on Tuesday, while world ending stocks were raised by 1.1 million tonnes, to 287.7 million.

The USDA releases quarterly stocks and planting intentions data at the end of the month, and traders are already looking ahead to the reports.

WHEAT futures were lower in sympathy with soybeans and corn, although activity was choppy as wheat remains stuck in a relatively sideways trading range.

U.S. wheat ending stocks were left unchanged at 836 million bushels by the USDA yesterday. World stocks were lowered by three million tonnes from February, which remained somewhat supportive.

The Western Producer

Tags: corn, USDA, canola, soybean futures