Crops soar Monday on dry U.S. weather

When expected weekend rain in the U.S. Midwest failed to materialize this weekend, markets on Monday soared, with nearby canola posting the strongest one day percentage gain in 2 ½ years.

The rally added to the gains made last week following the USDA report that was bullish for oilseeds.

November canola at the close Monday was again comfortably above $500 per tonne at $517.80, after falling as low as $472.40 on Aug. 6.

It was the first significant rally this summer, which has been characterized by falling grain and oilseed prices due to generally favourable growing weather in the U.S. Midwest, Canadian Prairies and Europe.

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The canola market could be rattled by the Statistics Canada crop production forecast due for release Wednesday.

Look for coverage of the StatsCan report at Producer.com and at our Twitter feeds (I tweet at @ darcemcmillan).

The good weather this summer had caused commodity funds and speculators to bet that prices would continue to fall. They built a large net short position but had to scramble to cover those shorts as the weather turned dry in the last couple of weeks.

The U.S. corn crop is in its kernel filling stage of development while the soybean crop is in its weather vulnerable pod-setting stage.

“Corn yields may be trimmed a little, and I would be surprised if we don’t cut soybean yields,” said John Dee, a meteorologist for Global Weather Monitoring, Reuters reported. Damage will likely be limited by the lack of extreme hot temperatures.

The annual Pro Farmer industry tour of Midwest crops was taking place this week. It was expected to find potential bumper crops of corn and soybeans but also crop maturity that is behind normal.

Warm weather this week in Western Canada will help mature crops that are in a race with Mother Nature to see if they can escape frost damage.

Winnipeg ICE Futures Canada dollars per tonne

Canola Nov 2013 517.80 +17.20 +3.44%

Canola Jan 2014 523.10 +16.80 +3.32%

Canola Mar 2014 528.40 +17.00 +3.32%

Canola May 2014 532.90 +16.50 +3.20%

Canola Jul 2014 537.40 +15.80 +3.03%

Milling Wheat Oct 2013 255.00 +5.00 +2.00%

Milling Wheat Dec 2013 259.00 +4.00 +1.57%

Milling Wheat Mar 2014 264.00 +4.00 +1.54%

Durum Wheat Oct 2013 289.00 +3.00 +1.05%

Durum Wheat Dec 2013 294.00 +4.00 +1.38%

Durum Wheat Mar 2014 304.00 +4.00 +1.33%

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 Sep 2013 1322 +38.75 +3.02%

Soybeans Nov 2013 1303.25 +44 +3.49%

Soybeans Jan 2014 1303.75 +42 +3.33%

Soybeans Mar 2014 1279 +28.25 +2.26%

Soybeans May 2014 1251 +17.5 +1.42%

Soybeans Jul 2014 1251 +15 +1.21%

Soybean Meal Sep 2013 420.3 +11.5 +2.81%

Soybean Meal Oct 2013 407.6 +17.4 +4.46%

Soybean Meal Dec 2013 404.2 +17.9 +4.63%

Soybean Oil Sep 2013 43.45 +0.64 +1.49%

Soybean Oil Oct 2013 43.51 +0.59 +1.37%

Soybean Oil Dec 2013 43.78 +0.62 +1.44%

Corn Sep 2013 493.25 +19.5 +4.12%

Corn Dec 2013 485.5 +22 +4.75%

Corn Mar 2014 497.75 +21.75 +4.57%

Corn May 2014 505.5 +21.5 +4.44%

Corn Jul 2014 510.75 +20.75 +4.23%

Oats Sep 2013 384.75 +7.25 +1.92%

Oats Dec 2013 336.25 +6.25 +1.89%

Oats Mar 2014 339.5 +5.75 +1.72%

Oats May 2014 340 +6 +1.80%

Oats Jul 2014 344.25 +6 +1.77%

Wheat Sep 2013 641.5 +10.5 +1.66%

Wheat Dec 2013 653.5 +10 +1.55%

Wheat Mar 2014 666.25 +10 +1.52%

Wheat May 2014 672.75 +9.5 +1.43%

Wheat Jul 2014 669 +8.5 +1.29%

Minneapolis

Spring Wheat Sep 2013 745.25 +8 +1.09%

Spring Wheat Dec 2013 745.5 +7.25 +0.98%

Spring Wheat Mar 2014 756.5 +6.5 +0.87%

Spring Wheat May 2014 761.75 +4.75 +0.63%

Spring Wheat Jul 2014 764.5 +4.25 +0.56%

Kansas City

KCBT Red Wheat Sep 2013 703.25 +5 +0.72%

KCBT Red Wheat Dec 2013 707.25 +5 +0.71%

KCBT Red Wheat Mar 2014 713.75 +3.75 +0.53%

KCBT Red Wheat May 2014 717.5 +3.75 +0.53%

KCBT Red Wheat Jul 2014 707.25 +2.5 +0.35%

Light crude oil nearby futures in New York dropped 36 cents at $107.10 US per barrel.

The Canadian dollar at noon was 96.77 cents US, up from 96.67 cents the previous trading day. The U.S. dollar at noon was $1.0334 Cdn.

U.S. stocks lost ground on Monday, Reuters reported, with each of the major indexes falling for a fourth straight session, as investors were hesitant to make new bets ahead of an expected shift in Federal Reserve policy that could lead to higher interest rates.

In unofficial tallies —

The Toronto Stock Exchange’s S&P/TSX composite index closed down 148.86 points, or 1.17 percent, and 12,588.06

The Dow Jones industrial average fell 71.11 points or 0.47 percent, to 15,010.36, the S&P 500 lost 9.77 points or 0.59 percent, to 1,646.06 and the Nasdaq Composite dropped 13.692 points or 0.38 percent, to 3,589.086.