Weak loonie, short covering lifts canola

Most crop futures made slight gains Wednesday but closed off their highs on a round of late day profit taking.

Short covering was a feature across the board.

Canola enjoyed support from a sharply weaker loonie and from palm oil that rose again today on the strength of yesterday’s report that palm production in Malaysia fell in the first 20 days of October.

October often is the peak production month for palm but this report indicates that the high ended in September.

This lessens previous worries that palm stocks would rise and become a burden in the second half of the year.

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Strong cash demand for soy meal provided spillover support to soybeans. U.S. farmers are not rushing to sell their big harvest and that is causing feeders and processors to increase bids to pry loose supply.

Wheat rose on expectations of a declining wheat crop in Argentina and a bank forecast that cut Australia’s wheat output. Corn followed wheat higher.

Argentina’s government has not yet come out with a revised wheat number. On Oct. 18 it published a production forecast of 8.8 million tonnes but this week said that number was incorrect and it would produce a revised forecast.

Still, analysts believe that because of dry soil and frosts the crop will be quite a bit smaller than USDA’s September estimate of 12 million tonnes.

Also Brazil’s crop had been damaged by frost and so it will have to import more supply.

A report from Commonwealth Bank of Australia also lifted wheat.

The bank cut its estimate of Australia’s wheat crop by 1.6 million tonnes, lowering it to 23.6 million. USDA’s September estimate was 25.5 million.

Western Australia, the largest producing state, has a great crop, but wheat areas in the eastern part of the country, including New South Wales, have suffered dry weather and frosts.

Harvest is progressing rapidly in Australia and the pace should continue given the forecast for dry, warm weather.

While Australia and Argentina’s crops are being scaled back, Canada’s wheat crop is likely larger than the 33 million tonnes forecast (including durum) in the September Statistics Canada report.

Winnipeg ICE Futures Canada dollars per tonne

Canola Nov 2013 493.40 +2.00 +0.41%

Canola Jan 2014 503.80 +1.70 +0.34%

Canola Mar 2014 512.30 +1.40 +0.27%

Canola May 2014 519.30 +1.50 +0.29%

Canola Jul 2014 524.60 +1.40 +0.27%

Milling Wheat Dec 2013 238.00 unch 0.00%

Milling Wheat Mar 2014 244.00 unch 0.00%

Milling Wheat May 2014 248.00 unch 0.00%

Durum Wheat Dec 2013 247.00 unch 0.00%

Durum Wheat Mar 2014 253.00 unch 0.00%

Durum Wheat May 2014 257.00 unch 0.00%

Barley Dec 2013 152.00 unch 0.00%

Barley Mar 2014 154.00 unch 0.00%

Barley May 2014 155.00 unch 0.00%

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

Chicago

Soybeans Nov 2013 1310 +7.75 +0.60%

Soybeans Jan 2014 1304 +6.5 +0.50%

Soybeans Mar 2014 1283.5 +5.5 +0.43%

Soybeans May 2014 1266.25 +5.75 +0.46%

Soybeans Jul 2014 1262.25 +5.5 +0.44%

Soybeans Aug 2014 1250 +4.5 +0.36%

Soybean Meal Dec 2013 421.4 +5.3 +1.27%

Soybean Meal Jan 2014 413.2 +3.6 +0.88%

Soybean Meal Mar 2014 400.9 +3 +0.75%

Soybean Oil Dec 2013 41.5 -0.02 -0.05%

Soybean Oil Jan 2014 41.8 -0.03 -0.07%

Soybean Oil Mar 2014 42.18 -0.04 -0.09%

Corn Dec 2013 442.75 +4.5 +1.03%

Corn Mar 2014 455.25 +4.25 +0.94%

Corn May 2014 463.75 +4.5 +0.98%

Corn Jul 2014 471.25 +4.25 +0.91%

Corn Sep 2014 477.5 +4.25 +0.90%

Oats Dec 2013 344.5 +3.25 +0.95%

Oats Mar 2014 318.5 +1.25 +0.39%

Oats May 2014 317.5 +1 +0.32%

Oats Jul 2014 319 +6.25 +2.00%

Oats Sep 2014 318 +6.25 +2.00%

Wheat Dec 2013 701.75 +1 +0.14%

Wheat Mar 2014 711.5 +0.75 +0.11%

Wheat May 2014 715 +1.25 +0.18%

Wheat Jul 2014 703.75 +1 +0.14%

Wheat Sep 2014 709.5 +1.75 +0.25%

Minneapolis

Spring Wheat Dec 2013 758.75 +2.5 +0.33%

Spring Wheat Mar 2014 768.5 +2.25 +0.29%

Spring Wheat May 2014 773 +0.25 +0.03%

Spring Wheat Jul 2014 772.5 +1 +0.13%

Spring Wheat Sep 2014 766.5 -1 -0.13%

Kansas City

KCBT Red Wheat Dec 2013 770.75 +5.25 +0.69%

KCBT Red Wheat Mar 2014 769.5 +4.5 +0.59%

KCBT Red Wheat May 2014 766 +3 +0.39%

KCBT Red Wheat Jul 2014 745.75 +1.25 +0.17%

KCBT Red Wheat Sep 2014 750.5 +0.25 +0.03%

Light crude oil nearby futures in New York dropped $1.44 at $96.86 US per barrel. Crude stocks are rising in the United States

The Canadian dollar at noon was 96.29 cents US, down from 97.24 cents the previous trading day. The U.S. dollar at noon was $1.0385 Cdn.

The Bank of Canada today said it would not change its interest rates and abandoned its previous warnings that rates would rise in the future. Economic growth and inflation have slowed, pushing back the need to hike interest rates.

Strong quarterly reports from Canadian National and Canadian Pacific railways lifted those stocks and had the Toronto Stock exchange composite slightly ahead this afternoon.

Weak quarterly results from Caterpillar helped push the S&P 500 lower.

In early tallies —

The Toronto Stock Exchange’s S&P/TSX composite index closed down 4.74 points, or 0.04 percent, at 13,243.32.

It had risen in the previous six sessions and is at a two-year peak.

The Dow Jones industrial average rose 22.19 points, or 0.14 percent, to end at 15,567.74.

The Standard & Poor’s 500 Index slipped 3.14 points, or 0.19 percent, to close at 1,692.39.

The Nasdaq Composite Index declined 21.11 points, or 0.59 percent, to finish at 3,579.27.