Winnipeg Commodity Exchange Sees Mixed Start to Grain and Oilseed Futures

Strategic Insights -

The Winnipeg Commodity Exchange (WCE) is expected to start Tuesday's session on a mixed note, with carryover selling from Monday's lower close generating some downward price action. However, good commercial demand and a weaker Canadian dollar are seen stimulating buying interest, particularly in canola futures, which are expected to be unchanged to C$1.00 per metric ton higher. The mixed calls for CBOT soybean futures are capping the upward price momentum in canola, while flaxseed futures are expected to open unchanged due to a lack of fresh fundamental inputs. The feed grains, including western barley and feed wheat, are expected to be on the defensive early, with lower calls for CBOT corn and wheat futures potentially facilitating selling interest.

Key Takeaways:

  • Canola futures are expected to be unchanged to C$1.00 per metric ton higher due to ideas that Monday's sell-off was overdone and an upward correction is required.
  • Strength in Malaysian palm oil futures overnight is seen as supportive for canola prices.
  • New crop contracts in canola are expected to garner support from growing concern about dryness in Saskatchewan and Alberta.
  • Continued talk of Chinese new crop canola bookings will help to keep a firm floor under canola prices.
  • CBOT soybean futures are seen as capping the upward price momentum in canola, with any significant losses potentially dragging canola prices down.
  • Flaxseed futures are expected to open unchanged due to a lack of fresh fundamental inputs.
  • The feed grains, including western barley and feed wheat, are expected to be on the defensive early.
  • Scale-down commercial buying is expected to temper the price slide in western barley.

Statistics:

  • Canola futures are expected to be unchanged to C$1.00 per metric ton higher.
  • Malaysian palm oil futures saw strength overnight.
  • Uzbekistan (in not given) should help to deliver more interest for Vanagon.
  • Dryness in Saskatchewan and Alberta is a concern for new crop contracts.
  • The absence of demand is seen adding to the downward price movement in feed wheat.
  • Scale-down commercial buying will likely impact the price of western barley.

Sources:

  • Resource News International via COMTEX
  • COMTEX (http://www.comtexnews.com)