Worries about the size of the canola crop drove Winnipeg futures higher Tuesday.
Severe thunderstorms Monday in southern areas of the Prairies added to the excess moisture concerns. Thunderstorms are a strong possibility again today. Central Butte, northwest of Moose Jaw, Sask., received 100 millimetres of rain Monday night.
Farmers, unsure of their production prospects and hoping that prices will rise further, are not selling.
Statistics Canada releases its planting survey Wednesday. Given the timing of the survey in late May, it is questionable if the report will be an accurate representation of what was seeded.
Oil World forecasted Tuesday that Canada would produce 10.3 million tonnes of canola, down from an earlier forecast of 12.8 million and down from last year’s crop of 11.83 million tonnes.
Richardson officially opened its Yorkton, Sask., crushing plant today. Officials said the plant is operating at about 50 percent capacity now with the hope of moving to full capacity by early in 2011.
Pat Van Osch, Richardson’s vice-president and general manager of oilseed processing, said 15 million acres of canola were likely seeded despite the rain, and farmers could harvest about 10 million tonnes.
July canola rose $6.60 per tonne Tuesday to $426.70 on 4,690 trades.
The previous day’s best basis narrowed to $7.10 per tonne off the July contract in the par region, according to the Winnipeg ICE Futures daily report.
The 14-day Relative Strength Index for July canola was 84, according to BarChart.com. The rule of thumb is that an RSI of 30 indicates an oversold market and 70 indicates overbought.
New crop November canola rose $6.20 per tonne to $425.20 on 10,826 trades.
May 2010 rose $6.80 to $422.70
The Canadian dollar at noon was 98.03 cents US, little changed from 98.05 cents at noon the previous trading day. The U.S. dollar at noon was $1.0201 Cdn.
There was no trade in Winnipeg barley. July was $155. October was steady at $150.40. December was steady $150.40.
Chicago July soybeans rose 2.25 cents to $9.655 US per bushel; new-crop November fell three cents to $9.36.
July oats rose 13.5 cents to $2.78 per bu. December oats rose 10.5 cents to $2.79 per bu.
In New York, crude oil for July delivery fell 61 cents to $77.21 per barrel.
