Canola struggles, closes up slightly

It was almost as if Monday’s U.S. Department of Agriculture reports hadn’t happened.

But some traders attributed the slight increases to soybean and canola futures today to the carry-over effects of USDA, since corn and wheat fell when the report was first released.

“The report basically told traders they can’t sit on their hands any more,” said Ken Ball of P.I. Financial in Winnipeg.

“They can’t just assume the big crops will roll in to the bin.”

USDA cut soybean yields by about two bushels per acre from the July supply and demand reports, which was three bu. per acre lower than most analysts had guessed before the report was issued.

Read Also

Trump bailout for trade-hit U.S. farmers expected this week

The Trump administration is expected to announce a plan as soon as Tuesday to bail out U.S. farmers stung by trade disputes and big harvests, with the initial outlay potentially totaling up to $15 billion (C$20.9 billion), according to sources familiar with the matter.

That led soybean prices sharply higher Monday, although the surprise finding did not create a limit-up move and today’s rise was less than three cents per bu. Canola rose about three cents per bu.

Ball said canola’s performance both Monday and today was weaker than that of soybeans, even if it looked similar on the charts.

“Canola really struggled to follow the soybean markets in the last two days, with the Canadian dollar going down and bean oil kicking up, canola could have been $8 to $10 higher than it is now to be in line with the U.S. market,” said Ball.

The great shape of the prairie canola crop is likely the cause of the difference, Ball said. U.S. soybean crops are mostly in good shape, but substantial areas are poorer, and the crop needs a couple of rains to fill pods.

Canola is seen to have fewer challenges, other than frost risk.

The fall in corn, with September, December and March futures contracts falling over 16 cents per bushel, underlined the bearishness of the market towards the leading cereal grain crop. USDA also cut corn yields Monday, but that has not stopped the crop’s futures from sliding.

Spring wheat futures fell just over three cents per bu.

Winnipeg ICE Futures Canada dollars per tonne

Canola Nov 2013   495.40   +1.50   +0.30%
Canola Jan 2014   501.70   +2.20   +0.44%
Canola Mar 2014   507.90   +2.80   +0.55%
Canola May 2014   514.20   +3.10   +0.61%
Canola Jul 2014   519.70   +3.40   +0.66%

Milling Wheat Oct 2013   250.00   -2.00   -0.79%
Milling Wheat Dec 2013   255.00   -1.00   -0.39%
Milling Wheat Mar 2014   260.00   -1.00   -0.38%

Durum Wheat Oct 2013   286.00   unch   0.00%
Durum Wheat Dec 2013   290.00   unch   0.00%
Durum Wheat Mar 2014   300.00   unch   0.00%

Barley Oct 2013 189.00 unch 0.00%

Barley Dec 2013 194.00 unch 0.00%
Barley Mar 2014 194.00 unch 0.00%

American crop prices in cents US/bushel, soybean meal in $US/short ton, soy oil in cents US/pound

Chicago
Soybeans Aug 2013   1359.75   -14   -1.02%
Soybeans Sep 2013   1257.75   +1.25   +0.10%
Soybeans Nov 2013   1227.75   +2.5   +0.20%
Soybeans Jan 2014   1232.5   +2.5   +0.20%
Soybeans Mar 2014   1233   +0.25   +0.02%
Soybeans May 2014   1228   -3.25   -0.26%

Soybean Meal Aug 2013   426.9   +1.2   +0.28%
Soybean Meal Sep 2013   401.8   -0.9   -0.22%
Soybean Meal Oct 2013   376.7   +1.2   +0.32%

Soybean Oil Aug 2013   42.58   +0.26   +0.61%
Soybean Oil Sep 2013   42.62   +0.24   +0.57%
Soybean Oil Oct 2013   42.67   +0.19   +0.45%

Corn Sep 2013   455.25   -16.75   -3.55%
Corn Dec 2013   447.25   -16.75   -3.61%
Corn Mar 2014   460.75   -16.5   -3.46%
Corn May 2014   469   -16.5   -3.40%
Corn Jul 2014   475.25   -16   -3.26%

Oats Sep 2013   360.75   -1.5   -0.41%
Oats Dec 2013   327.25   -3   -0.91%
Oats Mar 2014   332.5   -1.5   -0.45%
Oats May 2014   332.75   -1.5   -0.45%
Oats Jul 2014   337   -1.5   -0.44%

Wheat Sep 2013   628.25   -6.75   -1.06%
Wheat Dec 2013   641.5   -7.5   -1.16%
Wheat Mar 2014   655.5   -8   -1.21%
Wheat May 2014   664   -8   -1.19%
Wheat Jul 2014   662.5   -8   -1.19%

Minneapolis
Spring Wheat Sep 2013   732.5   -4.25   -0.58%
Spring Wheat Dec 2013   738.25   -3.25   -0.44%
Spring Wheat Mar 2014   750.25   -3.25   -0.43%
Spring Wheat May 2014   756   -4.25   -0.56%
Spring Wheat Jul 2014   760   -4   -0.52%

Kansas City
KCBT Red Wheat Sep 2013   696.25   -4   -0.57%
KCBT Red Wheat Dec 2013   702   -4.75   -0.67%
KCBT Red Wheat Mar 2014   710.75   -4.75   -0.66%
KCBT Red Wheat May 2014   713.25   -4   -0.56%
KCBT Red Wheat Jul 2014   697.25   -5.25   -0.75%

Light crude oil nearby futures in New York rose 72 cents at $106.83 US per barrel.
The Canadian dollar at noon was 96.67 cents US, down from 97.12 cents the previous trading day. The U.S. dollar at noon was $1.0345 Cdn.