Winnipeg Commodity Exchange (WCE) Grain and Oilseed Futures Decline

Grain and oilseed futures on the Winnipeg Commodity Exchange (WCE) ended their session mainly lower, with feed wheat and canola establishing new contract lows. Steady farmer deliveries to the country elevator system and subsequent hedge offers weighed on values, while a pull-back in the value of the Canadian dollar helped to temper the price slide. Commercial and commission house selling, including hedge-related and losses seen in CBOT soybean futures, contributed to the downward price action in canola.

Key Takeaways:

• Feed wheat and canola futures established new contract lows during the session, with the lack of fresh demand adding to the downward price slide.
• Steady farmer deliveries to the country elevator system and subsequent hedge offers weighed on values, with commercial and commission house selling contributing to the downward price action.
• A pull-back in the value of the Canadian dollar helped to temper the price slide, but concerns about high ocean freight rates and the absence of fresh export demand continued to weigh on canola values.
• Declines in Malaysian palm oil futures helped to spark early downward price action, but the losses were offset by the pricing of old export business and some light bouts of short-covering.
• Refco was a seller of canola during the session, while Fimat Canada Ltd was a featured player on both sides of the trade.
• Canada sold 10,000 metric tons of canola to Japan on the spot cash market overnight, with price and shipping details not available.
• Western barley futures were narrowly mixed in light trade, with light commercial liquidation and a downturn in CBOT corn futures contributing to the weakness.

Statistics:

• Feed wheat futures established new contract lows, with prices in Canadian dollars per metric ton.
• Canola futures declined, with spreading of the Jan/Mar contracts at $3.50 under.
• Commercial and commission house selling contributed to the downward price action in canola, with hedge-related and losses seen in CBOT soybean futures.
• The value of the Canadian dollar pulled back, tempering the price slide.
• High ocean freight rates and the absence of fresh export demand continued to weigh on canola values.
• Malaysia palm oil futures declined, sparking early downward price action.
• 10,000 metric tons of canola were sold to Japan on the spot cash market overnight.

Sources:

• Resource News International News, "Winnipeg Commodity Exchange Report" (Nov 30, 2004)
• COMTEX, http://www.comtexnews.com