Jan canola falls $4.50 on week pressured by big crop

Canola futures continued to trade in a narrow range on Friday with slight support from stronger palm oil but pressure from estimates for huge soybean and canola crops.

Canola started off slightly higher as palm futures posted gains on continuing thoughts that good exports and reduced production will prevent a build up of palm stocks.

But the value of most crop futures fell mid morning when research and consulting company Informa Economics released its latest increased estimates of the size of the U.S. corn and soybean crops. The details are later in this report.

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Most traded January canola closed at $491.40, down $3. November closed at $481.70, down $1.90.

For the week, January fell $4.50 and November fell $3.70. (an earlier version of this story had the wrong weekly price change.)

Crop futures generally traded in narrow ranges this week after falling in the last couple of weeks on harvest pressure. It is now clear that North American crops performed exceptionally well this year. Exports are good, particularly of U.S. soybeans and corn. U.S. wheat exports started the crop year strong, but are moderating.

The market needs new news to trade on and the mostly likely source will be the Nov. 8 U.S. Department of Agriculture crop supply and demand reports.

The Canadian Oilseed Processors Association said members crushed 145,106 tonnes of canola in the week ending Oct. 30, up 4.2 percent from the previous week.

That represented a capacity use of 83 percent. Last year at the same time the crush capacity use was almost 88 percent.

So far this crop year, about 1.526 million tonnes have been crushed, down 14 percent.

Analysts believe the USDA will make hefty increases to its estimate of U.S. crop sizes when it reports on Nov. 8.

Crop forecaster Informal Economics today increased its estimate of corn average yield to 161.2 bushels per acre from 158.8 in its last monthly report.

It put the crop size at 14.223 billion bushels, up from 14.010 billion previously.

It pegged soybean yield at 43.3 bushels per acre, up from 41.7. It sees the crop at 3.298 billion bushels, up from 3.176 billion.

Informa used a harvested area calculation for U.S. corn at 88.250 million acres and soybeans at 76.118 million acres.

The company lowered its forecast for Argentina’s wheat crop to 9.8 million tonnes from 11 million. It lowered the Argentina corn crop forecast to 25 million tonnes from 27 million.

Early next week most of Oklahoma and Kansas are expected to get rain in amounts from 0.75 to about three inches. Lesser amounts in the Midwest but that might cause further delays in the U.S. corn and soy harvests after rain delays this week.

Winnipeg ICE Futures Canada dollars per tonne

Canola Nov 2013 481.70 -1.90 -0.39%

Canola Jan 2014 491.40 -3.00 -0.61%

Canola Mar 2014 499.40 -3.00 -0.60%

Canola May 2014 505.50 -3.20 -0.63%

Canola Jul 2014 511.20 -3.20 -0.62%

Milling Wheat Dec 2013 227.00 -2.00 -0.87%

Milling Wheat Mar 2014 235.00 -2.00 -0.84%

Milling Wheat May 2014 243.00 -1.00 -0.41%

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 1266 -14.25 -1.11%

Soybeans Jan 2014 1251.5 -14.75 -1.16%

Soybeans Mar 2014 1237 -13.25 -1.06%

Soybeans May 2014 1228.5 -10.25 -0.83%

Soybeans Jul 2014 1224.5 -10.25 -0.83%

Soybeans Aug 2014 1211.75 -11 -0.90%

Soybean Meal Dec 2013 394.9 -8.7 -2.16%

Soybean Meal Jan 2014 387.9 -8.6 -2.17%

Soybean Meal Mar 2014 379.2 -7.9 -2.04%

Soybean Oil Dec 2013 41.59 +0.26 +0.63%

Soybean Oil Jan 2014 41.9 +0.27 +0.65%

Soybean Oil Mar 2014 42.27 +0.28 +0.67%

Corn Dec 2013 427.25 -1 -0.23%

Corn Mar 2014 437.5 -1.75 -0.40%

Corn May 2014 445.75 -1.75 -0.39%

Corn Jul 2014 452.25 -2 -0.44%

Corn Sep 2014 458.75 -2 -0.43%

Oats Dec 2013 329.5 -0.75 -0.23%

Oats Mar 2014 311.25 -0.75 -0.24%

Oats May 2014 306.75 -1 -0.32%

Oats Jul 2014 305.75 -0.5 -0.16%

Oats Sep 2014 307.75 -0.5 -0.16%

Wheat Dec 2013 667.75 +0.25 +0.04%

Wheat Mar 2014 679.75 +0.25 +0.04%

Wheat May 2014 686.25 +1.25 +0.18%

Wheat Jul 2014 684.75 +1.25 +0.18%

Wheat Sep 2014 693.5 +1.5 +0.22%

Minneapolis

Spring Wheat Dec 2013 725.5 -4.75 -0.65%

Spring Wheat Mar 2014 737 -4 -0.54%

Spring Wheat May 2014 743.5 -4.25 -0.57%

Spring Wheat Jul 2014 748.5 -1.75 -0.23%

Spring Wheat Sep 2014 744.5 -2.75 -0.37%

Kansas City

KCBT Red Wheat Dec 2013 733.5 -7 -0.95%

KCBT Red Wheat Mar 2014 736 -6.25 -0.84%

KCBT Red Wheat May 2014 735.5 -3.75 -0.51%

KCBT Red Wheat Jul 2014 722.75 -0.25 -0.03%

KCBT Red Wheat Sep 2014 728.25 -0.5 -0.07%

Light crude oil nearby futures in New York dropped $1.77 at $94.61 US per barrel.

The Canadian dollar at noon was 95.76 cents US, down from 95.89 cents the previous trading day. The U.S. dollar at noon was $1.0443 Cdn.

Reuters reported major U.S. stock indexes were mixed in afternoon trading on Friday as investors took October’s surprisingly strong U.S. manufacturing data as a potential sign the Federal Reserve could reduce its stimulus earlier than expected.

Manufacturing activity expanded around the world, several business surveys showed, with Chinese manufacturers reporting the fastest upturn in 18 months. The Institute for Supply Management said on Friday its index of U.S. factory activity rose to 56.4 in October, its best reading since April 2011, Reuters reported.

Normally such news would send stocks up, but the Dow and the S&P 500 are not far from highs reached earlier this week, and investors are now thinking about how this affects the Fed’s $85 billion in monthly bond purchases. The Fed’s stimulus has given buyers a reason to invest in riskier assets like stocks, Reuters reported

The TSX was trading down, pressured by sharply lower shares of Barrick Gold Corp., which said it planned to issue $3 billion in stock to help pay down debt.

In early tallies —

The Toronto Stock Exchange’s S&P/TSX composite index closed down 23.80 points, or 0.18 percent, at 13,337.46. The index was down 0.47 percent on the week, ending three straight weeks of solid gains.

The Dow Jones industrial average rose 69.80 points or 0.45 percent, to close at 15,615.55.

The S&P 500 gained 5.10 points or 0.29 percent, to finish at 1,761.64.

The Nasdaq Composite added 2.336 points or 0.06 percent, to end at 3,922.042.

For the week, the Dow rose 0.3 percent and the S&P added 0.1 percent as both notched their fourth consecutive weekly advance. The Nasdaq Composite dropped 0.5 percent for the week.