Spring wheat future down on bearish USDA report, canola little changed on week

December spring wheat future were slammed down 3.3 percent Friday as the USDA said the crop was larger than expected.

The USDA reports were more positive for soybeans and corn, causing modest rallies in those crops that spilled over to support canola.

November canola closed at $492.40 per tonne, up $1.60 on the day.

The oilseed saw only slightly movements all week.

Compared to last Friday the November contract is down $2.40 a tonne.

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Harvest in Western Canada in the last 10 days or so has been delayed by wet weather but progress should have begun again in the last day or two with sunny, warm weather.

However a weather system moving into the Prairies on Sunday is expected to bring rain and much cooler temperatures early next week.

Some of the heaviest accumulations of rain are expected south of the TransCanada Highway in Saskatchewan, which had some of the driest weather this summer.

Weather has been good in the U.S. Midwest but rain is expected in Minnesota and northern Iowa in coming days.

USDA REPORTS

The U.S. government released its Small Grains annual and quarter stocks reports this morning.

WHEAT

It pegged the spring wheat crop at 416.2 million bushels, down from 532.2 million last year but at the high end of the trade’s expectations and up from last month’s forecast of 402 million.

The drought in the U.S. northern Plains took a toll on yield. USDA pegged it at 41 bu. per acres, down from 47.3 bu last year and 46.2 bu. in 2015.

It pegged the harvested area at 10.16 million acres, down 7.7 percent from the area seeded, more than the 2.6 percent decline in 2016 and 2.3 percent in 2015. In August the harvested area forecast was 10.5 million acres.

The abandonment number increased because some farmers cut poor wheat crops for livestock feed as pastures burned up.

DURUM

USDA said the durum crop was 55 million bushels, down from 104 million last year, but up from 51 million forecast last month and at the top end of the trade’s expectation.

There is no futures market for durum.

According to PDQInfo.ca the average cash price in southwestern Saskatchewan has been fairly steady for the past two weeks at around C$267 per tonne, down from the peak of about $310 in mid August.

STOCKS

The USDA pegged US Sept. 1 soybean stocks at 301 million bu., below the trade’s range of forecast of 321 million to 363 million.

It pegged corn stocks at 2.295 billion bu., below the range of expectations of 2.31 million to 2.45 million.

Wheat stocks at 2.253 billion bu. were slightly above the midpoint of expectations.

CANOLA CRUSH

The canola crush rose almost nine percent in the week to 184,831 tonnes, representing a capacity use of 83.4 percent. That is starting to get back to the kind of pace common last crop year.

The total crush to date is 1.28 million tonnes, down from 1.35 million at the same point last year.

Given that total canola supply this year is expected to be similar to last year, it will be important to maintain a similar pace of crush and exports.

Canola exports in the last week jumped significantly higher, helping to catch up to last year’s pace after several slow weeks.

OUTSIDE MARKETS

Light crude oil nearby futures in New York were up 11 cents at US$51.67 per barrel.

In the afternoon, the Canadian dollar was trading around US80.15 cents, down from 80.42 cents the previous trading day. The U.S. dollar was C$1.2477.

Canada’s monthly GDP was unchanged in July, ending an eight month string of gains.

The slower economy gives room to the Bank of Canada to take its time raising interest rates.

The Toronto Stock Exchange’s S&P/TSX composite index rose 16.69 points, or 0.11 per cent, to close at at 15,634.94.

The Dow Jones Industrial Average rose 23.89 points, or 0.11 percent, to 22,405.09, the S&P 500 gained 9.3 points, or 0.37 percent, to 2,519.36 and the Nasdaq Composite added 42.51 points, or 0.66 percent, to 6,495.96.

For September the TSX composite rose 2.8 percent, the S&P rose 1.9 percent, the Dow added 2.1 percent, the Nasdaq gained 1.05 percent.

For the third quarter, the TSX was up about three percent, the Dow climbed 4.9 percent, the S&P advanced four percent and the Nasdaq gained 5.8 percent.

 

Winnipeg ICE Futures Canada dollars per tonne

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Canola Nov 17   492.40s   +1.60   +0.33%

Canola Jan 18   498.90s   +1.60   +0.32%

Canola Mar 18   503.60s   +1.70   +0.34%

Canola May 18   505.90s   +1.80   +0.36%

Canola Jul 18   506.70s   +1.90   +0.38%

 

Milling Wheat Oct 17   236.00s   unch   unch

Milling Wheat Dec 17   238.00s   unch   unch

Milling Wheat Mar 18   244.00s   unch   unch

 

Durum Wheat Oct 17   280.00s   +1.00   +0.36%

Durum Wheat Dec 17   284.00s   +1.00   +0.35%

Durum Wheat Mar 18   287.00s   +1.00   +0.35%

 

Barley Oct 17   145.00s   unch   unch

Barley Dec 17   148.00s   unch   unch

Barley Mar 18   151.00s   unch   unch

 

American crop prices in cents US/bushel, soybean meal in $US/short ton, soy oil in cents US/pound. Prices are displayed with fractions (2/8, 4/8, and 6/8) instead of decimals. -2 equals .25, -4 equals .50, -6 equals .75. The “s” means it is the settlement.

 

Chicago

Soybeans Nov 17   968-2s   +8-6   +0.91%

Soybeans Jan 18   978-4s   +8-2   +0.85%

Soybeans Mar 18   987-6s   +8-2   +0.84%

Soybeans May 18   995-6s   +7-6   +0.78%

Soybeans Jul 18   1002-4s   +7-2   +0.73%

 

Soybean Meal Oct 17   311.5s   +4.7   +1.53%

Soybean Meal Dec 17   315.8s   +4.3   +1.38%

Soybean Meal Jan 18   317.8s   +4.2   +1.34%

 

Soybean Oil Oct 17   32.57s   -0.02   -0.06%

Soybean Oil Dec 17   32.82s   unch   unch

Soybean Oil Jan 18   32.99s   -0.01   -0.03%

 

Corn Dec 17   355-2s   +2-6   +0.78%

Corn Mar 18   367-6s   +2-4   +0.68%

Corn May 18   376-2s   +2-4   +0.67%

Corn Jul 18   383-6s   +2-4   +0.66%

Corn Sep 18   390-0s   +2-0   +0.52%

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Oats Dec 17   251-2s   +1-6   +0.70%

Oats Mar 18   255-2s   +1-6   +0.69%

Oats May 18   254-2s   +1-6   +0.69%

Oats Jul 18   250-0s   -1-0   -0.40%

Oats Sep 18   250-0s   -1-0   -0.40%

 

Wheat Dec 17   448-2s   -6-6   -1.48%

Wheat Mar 18   466-4s   -7-6   -1.63%

Wheat May 18   479-2s   -8-0   -1.64%

Wheat Jul 18   490-6s   -8-0   -1.60%

Wheat Sep 18   506-0s   -7-2   -1.41%

 

Minneapolis

Spring Wheat Dec 17   623-6s   -21-2   -3.29%

Spring Wheat Mar 18   637-0s   -19-6   -3.01%

Spring Wheat May 18   643-0s   -16-6   -2.54%

Spring Wheat Jul 18   645-0s   -13-2   -2.01%

Spring Wheat Sep 18   634-2s   -8-2   -1.28%

 

Kansas City

Hard Red Wheat Dec 17   442-6s   -10-2   -2.26%

Hard Red Wheat Mar 18   460-2s   -10-4   -2.23%

Hard Red Wheat May 18   474-0s   -10-2   -2.12%

Hard Red Wheat Jul 18   490-6s   -10-2   -2.05%

Hard Red Wheat Sep 18   509-0s   -10-0   -1.93%

 

Chicago livestock futures in US¢/pound, Pit trade

Live Cattle Oct 17   109.100s   +0.125   +0.11%

Live Cattle Dec 17   115.250s   +0.200   +0.17%

Live Cattle Feb 18   118.625s   +0.075   +0.06%

 

Feeder Cattle Oct 17   152.225s   -0.725   -0.47%

Feeder Cattle Nov 17   154.000s   -0.975   -0.63%

Feeder Cattle Jan 18   151.525s   -1.050   -0.69%

 

Lean Hogs Oct 17   55.400s   -0.150   -0.27%

Lean Hogs Dec 17   59.950s   +1.675   +2.87%

Lean Hogs Feb 18   65.050s   +1.700   +2.68%

 

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