Canola follows soybean oil rally

Soybean oil continued its impressive rally Monday, pulling canola higher with it.

On a generally green day of gains for crop futures other than corn, soybean oil was most impressive, rising more than three percent.

Since Oct. 13, soybean oil has risen almost 10 percent.

“I think it’s somewhat technical,” said Errol Anderson of Pro Market, suggesting recent Chinese buying of soybeans is not enough to explain the sudden rally.

Rising palm oil also supported vegetable oil values. Palm has risen because of strong demand and lower than expected production.

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All eyes should be on the markets tomorrow to see if the rally can continue, or if it will flag and show today to have been a blowoff, a rapid increase followed by a rapid drop.

“To me the soybean oil market is overbought,” said Anderson.

“I wouldn’t be surprised if it dips tomorrow.”

Soybean oil often leads the way for canola prices because canola’s price comes mostly from its oil value. On Oct. 17, canola rose about 1.7 percent, or almost 20 cents per bushel.

That compares to soybeans rising 15 cents, or 1.6 percent, which is also relatively strong because soybean prices come primarily from meal value, and soybean meal rose less than one percent Oct. 17.

Spring wheat was almost unchanged, hard red winter wheat rose four cents and soft red winter rose almost three cents per bushel.

Oats rose one to two cents per bushel.

Soybeans have experienced a healthy export pace this year, and that appears to be continuing.

Canola prices are being underpinned by worries about the amount of western Canadian crop still lying in the field, subject to bad weather.

But Anderson said that is actually a bearish factor now, since farmers might make better progress than the market has factored in to its analyses.

“These guys, they’re going to get the crop,” said Anderson.

Grains were the strongest sector of the commodities complex, followed by meats.

Canola’s rise since the beginning of October has been dramatic, even looking parabolic on medium-term charts. From about $467 per tonne for March canola futures in early September, canola has soared to $506.

Light crude oil nearby futures in New York were down 41 cents to US$49.94 per barrel.

The Canadian dollar at noon was US76.12 cents, up from 75.94 cents the previous trading day. The U.S. dollar at noon was C$1.3138.

The Toronto Stock Exchange’s S&P/TSX composite index closed up 11.53 points, or 0.08 percent, at 14,596.52.

The Dow Jones industrial average fell 51.98 points, or 0.29 percent, to 18,086.4, the S&P 500 ost 6.48 points, or 0.3 percent, to 2,126.5 and the Nasdaq Composite dropped 14.34 points, or 0.27 percent, to 5,199.82.

Winnipeg ICE Futures Canada dollars per tonne
Canola Nov 2016   496.10   +8.60   +1.76%
Canola Jan 2017   503.30   +8.10   +1.64%
Canola Mar 2017   506.10   +7.20   +1.44%
Canola May 2017   508.90   +6.40   +1.27%
Canola Jul 2017   506.90   +5.50   +1.10%

Milling Wheat Dec 2016   232.00   unch   0.00%
Milling Wheat Mar 2017   238.00   unch   0.00%
Milling Wheat May 2017   242.00   unch   0.00%

Durum Wheat Dec 2016   294.00   unch   0.00%
Durum Wheat Mar 2017   303.00   unch   0.00%
Durum Wheat May 2017   308.00   unch   0.00%

Barley Dec 2016   132.50   unch   0.00%
Barley Mar 2017   134.50   unch   0.00%
Barley May 2017   135.50   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 2016   978.25   +15.50   +1.61%
Soybeans Jan 2017   986.00   +15.25   +1.57%
Soybeans Mar 2017   991.75   +15.50   +1.59%
Soybeans May 2017   998.50   +15.00   +1.53%
Soybeans Jul 2017   1004.25   +14.50   +1.47%
Soybeans Aug 2017   1003.00   +13.50   +1.36%

Soybean Meal Dec 2016   303.50   +2.80   +0.93%
Soybean Meal Jan 2017   304.80   +2.80   +0.93%
Soybean Meal Mar 2017   306.40   +2.80   +0.92%

Soybean Oil Dec 2016   35.44   +1.07   +3.11%
Soybean Oil Jan 2017   35.71   +1.10   +3.18%
Soybean Oil Mar 2017   35.94   +1.09   +3.13%

Corn Dec 2016   354.00   +0.50   +0.14%
Corn Mar 2017   364.00   +0.75   +0.21%
Corn May 2017   370.75   +1.25   +0.34%
Corn Jul 2017   377.00   +1.25   +0.33%
Corn Sep 2017   383.25   +0.75   +0.20%

Oats Dec 2016   200.00   +0.25   +0.13%
Oats Mar 2017   201.75   +2.00   +1.00%
Oats May 2017   204.50   -0.25   -0.12%
Oats Jul 2017   208.25   +9.25   +4.65%
Oats Sep 2017   217.25   -17.75   -7.55%

Wheat Dec 2016   423.75   +3.25   +0.77%
Wheat Mar 2017   442.00   +3.50   +0.80%
Wheat May 2017   455.75   +4.25   +0.94%
Wheat Jul 2017   467.00   +4.50   +0.97%
Wheat Sep 2017   481.75   +2.00   +0.42%

Minneapolis
Spring Wheat Dec 2016   529.00   +1.25   +0.24%
Spring Wheat Mar 2017   533.50   +1.50   +0.28%
Spring Wheat May 2017   539.75   +3.25   +0.61%
Spring Wheat Jul 2017   547.00   +2.25   +0.41%
Spring Wheat Sep 2017   553.75   -1.25   -0.23%

Kansas City
Hard Red Wheat Dec 2016   422.00   +5.50   +1.32%

Hard Red Wheat Mar 2017   439.00   +5.50   +1.27%
Hard Red Wheat May 2017   450.00   +6.25   +1.41%
Hard Red Wheat Jul 2017   460.75   +5.75   +1.26%
Hard Red Wheat Sep 2017   475.25   +4.75   +1.01%

Chicago livestock futures in US¢/pound (rounded to two decimal places)
Live Cattle (P) Oct 2016   97.28   +1.33   +1.39%
Live Cattle (P) Dec 2016   99.00   +1.62   +1.66%
Live Cattle (P) Feb 2017   100.70   +1.40   +1.41%

Feeder Cattle (P) Oct 2016   121.70   +1.60   +1.33%
Feeder Cattle (P) Nov 2016   117.22   +1.87   +1.62%
Feeder Cattle (P) Jan 2017   113.53   +1.91   +1.71%

Lean Hogs (P) Dec 2016   41.60   -0.40   -0.95%
Lean Hogs (P) Feb 2017   48.92   -0.98   -1.96%
Lean Hogs (P) Apr 2017   57.08   -0.37   -0.64%